The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the Employment Linked Incentive (ELI) Scheme, which will be implemented as the “PM Viksit Bharat Rozgar Yojana (PM-VBRY)” from 1st August 2025. The scheme aligns with the Government’s larger Viksit Bharat initiative and is aimed at generating inclusive, sustainable employment across India.
With a substantial outlay of Rs 99,446 crore, the PM-VBRY seeks to create over 3.5 crore new jobs over two years, with 1.92 crore beneficiaries entering the workforce for the first time. The scheme’s benefits will apply to employment generated between 1st August 2025 and 31st July 2027, marking a bold step in India’s mission toward employment-led economic development.
THE SCHEME IS STRUCTURED INTO TWO KEY PARTS:
Part A: Incentives for First-Time Employees
This component targets first-time employees registered with the Employees’ Provident Fund Organisation (EPFO). It offers an incentive equal to one month’s EPF wage (up to Rs 15,000), paid in two installments:
- First installment: After six months of continuous service.
- Second installment: After 12 months of service, coupled with successful completion of a financial literacy programme.
To promote savings culture among new earners, a portion of the incentive will be placed in a deposit account or savings instrument, accessible after a fixed tenure.
Part B: Support for Employers
Focusing on job creation across all sectors, especially manufacturing, this component encourages employers to expand their workforce. The government will provide an incentive of up to Rs 3,000 per month per new employee for two years, provided the employee remains in service for at least six months. For the manufacturing sector, this incentive will be extended to the third and fourth years as well.
To qualify, EPFO-registered establishments must hire:
- At least two additional employees (if current staff is below 50), or
- At least five additional employees (if current staff is 50 or more).
The PM-VBRY is a strategic initiative to stimulate the economy through employment and to empower millions of citizens by integrating them into the formal workforce. With its robust framework, the scheme is poised to catalyze a new era of job-led economic growth in India.
