Cabinet approves ₹1 trillion each for employment, R&D

The Union cabinet on Tuesday approved ₹1 trillion each for schemes to promote employment, as well as research, development, and innovation (RDI) in the country.

- Manas Pimpalkhare, Devina Sengupta & Shouvik Das

The employment-linked incentive (ELI) scheme, aimed at generating 35 million jobs in two years, will provide direct financial benefits up to ₹15,000 to 19.2 million first-time employees, Union minister of information and broadcasting Ashwini Vaishnaw said.

"This overall encourages youth to look at formal wage-led jobs instead of part-time, gig or other informal means of livelihood," noted Lohit Bhatia, president-workforce management at Quess Corp, one of India's largest staffing firms.

"Coming at a time of reduced interest rates and income tax reduction at entry level, it should be both beneficial for youth to come into employment as well as have a lot more disposable income for consumption."

First-time employees are those who register with the Employees' Provident Fund Organisation (EPFO) for the first time. Employees with annual salaries up to ₹1 lakh will be eligible.

Establishments registered with EPFO will be required to hire at least two additional employees (for employers with less than 50 employees) or five additional employees (for employers with 50 or more employees), on a sustained basis for at least six months.

The benefits would be applicable to jobs created between 1 August 2025 and 31 July 2027. For the manufacturing sector, incentives will be extended to the third and fourth years as well.