The ELI Scheme 2025, officially known as the Employment Linked Incentive Scheme, is a groundbreaking initiative by the Indian government to tackle unemployment and promote formal job creation. Approved by the Union Cabinet on July 1, 2025, this scheme aims to generate over 3.5 crore jobs within two years, with a special focus on the manufacturing sector. With a financial outlay of ₹99,446 crore, the ELI Scheme 2025 provides incentives to both first-time employees and employers, fostering economic growth and social security.
This article offers a detailed overview of the ELI Scheme 2025, including its objectives, benefits, eligibility criteria, and application process. Whether you’re a job seeker or an employer, this guide will help you understand how to leverage this transformative scheme.
Overview of the ELI Scheme 2025
| Scheme Name | Employment Linked Incentive Scheme (ELI Scheme 2025) |
| Organizing Body | Government of India (Ministry of Labour and Employment) |
| Beneficiaries | First-time employees and employers in the formal sector |
| Incentive for Employees | Up to ₹15,000 (one month’s salary) in two instalments |
| Incentive for Employers | Up to ₹3,000 per month per additional employee for two years |
| Duration | August 1, 2025, to July 31, 2027 |
| Financial Outlay | ₹99,446 crore |
What is the ELI Scheme 2025?
The ELI Scheme 2025 is a strategic initiative under the Union Budget 2024-25, designed to encourage private sector companies to create new job opportunities. By offering financial incentives, the scheme supports both first-time employees and employers, particularly in the formal sector. It is part of Prime Minister Narendra Modi’s broader package to provide employment and skilling opportunities to 4.1 crore youth over five years, with a total budget of ₹2 lakh crore.
The scheme is divided into two parts: Part A focuses on supporting first-time employees, while Part B incentivizes employers for hiring additional workers. The ELI Scheme 2025 is set to run from August 1, 2025, to July 31, 2027, and aims to transform India’s job market by promoting formal employment.
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Objectives of the ELI Scheme 2025
The ELI Scheme 2025 aims to address India’s unemployment challenges by encouraging formal job creation. Its key objectives include:
- Promoting Formal Employment: Encouraging private sector companies to hire new employees, especially first-time workers, through financial incentives.
- Enhancing Social Security: Ensuring employees are registered with the Employees’ Provident Fund Organisation (EPFO) for long-term financial security.
- Boosting Manufacturing: Providing extended benefits to the manufacturing sector to drive economic growth.
- Reducing Youth Unemployment: Supporting young individuals entering the workforce for the first time.
By aligning with these goals, the ELI Scheme 2025 seeks to create a robust and inclusive job market.
Eligibility Criteria for Employees
To benefit from the ELI Scheme 2025, employees must meet specific criteria:
- First-Time Employees: Must be new entrants to the formal workforce and registered with EPFO.
- Salary Threshold: Monthly salary should not exceed ₹1 lakh.
- Continuous Employment: Must remain employed for at least six months to receive the first instalment and 12 months for the second, along with completing a mandatory financial literacy course.
These conditions ensure that the scheme targets genuine first-time workers, promoting financial discipline and stability.
Benefits for Employees Under ELI Scheme 2025
Under Part A of the Employment Linked Incentive Scheme 2025, first-time employees receive significant benefits:
- Wage Subsidy: A one-month salary subsidy, up to ₹15,000, paid in two instalments. The first instalment is disbursed after six months of continuous employment, and the second after 12 months, subject to completing a financial literacy course.
- Savings Component: A portion of the incentive is deposited into a long-term savings account to encourage financial planning.
- Wide Coverage: The scheme applies to all formal sectors, benefiting approximately 1.92 crore first-time workers.
These benefits provide financial support and promote long-term savings among new employees.
Benefits for Employers Under ELI Scheme 2025
Part B of the ELI Scheme 2025 incentivizes employers to create additional jobs. The key benefits include:
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Monthly Incentives: Employers receive up to ₹3,000 per month per additional employee for two years, based on the employee’s salary slab:
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₹1,000 for salaries up to ₹10,000.
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₹2,000 for salaries between ₹10,000 and ₹20,000.
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₹3,000 for salaries between ₹20,000 and ₹1 lakh.
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Extended Benefits for Manufacturing: Employers in the manufacturing sector receive incentives for an additional two years (up to four years total).
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Minimum Hiring Requirements: Companies with fewer than 50 employees must hire at least two new workers, while those with 50 or more must hire at least five.
These incentives encourage businesses to expand their workforce, especially in high-potential sectors like manufacturing.
Application Process for the Employment Linked Incentive Scheme
The application process for the ELI Scheme 2025 requires registration with the EPFO. Employees must activate their Universal Account Number (UAN) and link it with their Aadhaar and bank account by June 30, 2025, for jobs joined in FY 2024–25. Employers must ensure compliance with labor laws and register new hires with EPFO.
Detailed guidelines for the Employment Linked Incentive Scheme 2025 application process will be released closer to the launch date. Employers and employees should monitor the Ministry of Labour and Employment’s website or the EPFO portal for updates.
Impact on India’s Economy
The ELI Scheme 2025 is expected to have a transformative impact on India’s economy. By incentivizing formal job creation, it will:
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Increase Employment: Generate 3.5 crore jobs, including 1.92 crore for first-time workers, reducing unemployment rates.
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Boost Consumption: Stable incomes for new employees will increase spending, stimulating economic growth.
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Enhance Manufacturing: Extended incentives for the manufacturing sector will strengthen India’s industrial base, contributing 17% to the GDP.
This scheme aligns with the government’s vision of a Viksit Bharat by 2047, fostering inclusive growth and economic resilience.
Challenges and Considerations
While the ELI Scheme 2025 holds immense potential, it faces certain challenges:
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Implementation: Coordinating between central and state governments, businesses, and EPFO requires efficient systems.
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Informal Sector: Transitioning workers from informal to formal employment may need additional outreach.
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Monitoring: AI-driven technologies will be used to ensure transparency and prevent misuse, such as passing off existing employees as new hires.
Addressing these challenges through clear guidelines and robust monitoring will be key to the scheme’s success.
Complementary Initiatives
The ELI Scheme 2025 is part of a broader package that includes skilling and internship programs. For instance, the Mukhyamantri Pratigya Yojana 2025 in Bihar offers internships with stipends of ₹4,000–₹6,000 to 5,000 youths. Additionally, the central government’s internship program under the ELI Scheme 2025 will provide 1 crore youth with hands-on experience in top 500 companies, supported by a ₹5,000 monthly stipend and a one-time ₹6,000 payment.
These initiatives complement the ELI Scheme 2025 by enhancing employability and bridging the gap between education and industry needs.
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Conclusion
The ELI Scheme 2025 is a game-changer for India’s job market, offering financial incentives to both employees and employers to boost formal employment. With a focus on first-time workers and the manufacturing sector, this scheme aims to create 3.5 crore jobs by 2027, fostering economic growth and social security. Employees and employers should prepare for the scheme’s launch on August 1, 2025, by ensuring EPFO registration and staying updated on official guidelines.
For more details, visit the Ministry of Labour and Employment’s website or the EPFO portal. Share this information to help others benefit from the Employment Linked Incentive Scheme.