The employment-linked incentive (ELI) scheme approved by the Cabinet recently may be merged with the PM Internship Scheme (PMIS) to achieve optimum efficacy of the two in boosting job creation, according to official sources.
Officials from the ministry of corporate affairs (MCA), which is spearheading PMIS, and the ministry of labour and employment, which will drive the ELI scheme, have already met once to discuss the possibility of the combining both the schemes, the sources added.
“The integration will be beneficial for the interns (under PMIS) and the participating companies. After training, the interns have to find regular employment. For companies which are investing in the training of the interns, if they end up absorbing these interns, they will get additional benefits under the ELI scheme,” said a source.
He added that there are also discussions going on to integrate the National Apprenticeship Promotion Scheme (NAPS) and National Apprenticeship Training scheme (NATS) programmes – run by the ministry of skill development and entrepreneurship – with the ELI scheme. “These are standalone schemes but they can be dovetailed into each other. The modalities are still being worked out. By way of mobilising candidates through its employment exchanges and online portal, the labour ministry is already working with MCA on PMIS,” a source said.
Experts said that a possible integration would increase the participation in the PMIS since candidates will have a better visibility on the permanent employment opportunities post the completion of their internships. So far, the pilot project of the PMIS has received lukewarm response where just about 8,000 interns have joined companies in the first round – way short of the 125,000 target set by the government for the pilot project (FY25). The hiring for the second round is currently underway, the source said.
On Tuesday, the Union cabinet approved Rs 99,446-crore ELI scheme to support employment generation and improve employability across different sectors with a special focus on the manufacturing sector. First announced by the finance minister Nirmala Sitharaman in her FY25 budget speech, the ELI scheme aims to incentivise the creation of over 35 million jobs over a two-year period – August 2025 and July 2027. Out of these, 19.2 million beneficiaries will be first time employees.
Divided into two parts, the scheme offers a wage subsidy of up to one month’s wage – subject to a maximum amount of Rs 15,000 – to the EPFO-registered first-time employees earning below Rs 1 lakh per month. In addition, the government will incentivise employers – up to Rs 3,000 per month per employee – for each additional employee hired above a baseline.
In May, FE had reported that the government has considerably increased the target for PMIS to 700,000 internships in FY26. The increase has come in the backdrop of a series of tweaks being made in the scheme, including geo-tagging the opportunities so that the candidates can opt for companies and units closer to their domiciles. Further, the top 500 participating companies under the PMIS have been providing extra incentives – over and above the government-mandated monthly stipend of Rs 5,000 – to attract a higher number of interns.