Union Budget 2024: Employment programme gets Rs 10,000 crore; paid internship scheme, Rs 2,000 crore

NEW DELHI: A new employment generation scheme announced in the Union Budget 2024 has been allocated Rs 10,000 crore. Another scheme aimed at providing paid internship opportunities in top 500 companies has been allocated Rs 2,000 crore for the current financial year, 2024-25.

In her budget speech, finance minister Nirmala Sitharaman announced a host of new schemes related to skilling and employment. “Our government will launch a comprehensive scheme for providing internship opportunities in 500 top companies to one crore youth in five years. They will gain exposure for 12 months to real-life business environment, varied professions and employment opportunities,” Sitharaman said.

The paid internship programme targets one crore youth over five years. She said that an internship allowance of Rs 5,000 per month along with a one-time assistance of Rs 6,000 will be provided to successful candidates securing internships. “Companies will be expected to bear the training cost and 10% of the internship cost from their Corporate Social Responsibility (CSR) funds,” she added. The ‘New Internship Programme’ will be implemented by the ministry of corporate affairs.

The employment generation programme will be implemented by the ministry of labour and employment and includes three initiatives targeting both employees – mainly those on their first jobs – and employers. However, its benefits can be accessed only by those in the formal sector and registered with the Employees’ Provident Fund Organisation (EPFO)

Union Budget 2024: Paid internship scheme

The internship scheme will be implemented in two phases with the first phase providing benefits to 30 lakh youth in the first two years. The second phase will be launched for the next three years to provide benefits to 70 lakh youths. The total amount earmarked for the scheme is Rs 63,000 crore with Rs 19,000 crore to be spent in phase I and the remaining Rs 44,000 crore in phase II.

The scheme aims to skill one crore youth by India’s top companies in five years. Eligible candidates between age 21 and 24 will be enrolled for 12 months in ‘Prime Minister’s Internship’.

The training cost will be borne by the company from CSR funds and participation of companies is voluntary. At least half the time should be in actual working experience or job environment, not in the classroom.

Eligible and interested students have to fill an application through an online portal. The companies will select candidates from a shortlist with emphasis on those with lower employability. The budget speech specifies which groups of candidates will not be covered by the scheme.

Following candidates will be ineligible:

• Qualification from Indian Institutes of Technology (IIT), Indian Institutes of Management (IIM), Indian Institutes of Science Education and Research (IISER), chartered accountants (CA), certified management accountants (CMA)

• Any member of the family is assessed for income tax

• Any member of the family is a government employee

Also read Nirmala Sitharaman took employment ideas from Congress manifesto, should’ve 'copied' others: Oppn

Budget 2024: Employment schemes

Sitharaman in her budget speech also announced three schemes for ‘Employment Linked Incentive’, as part of the Prime Minister’s package.

“These will be based on enrolment in the Employment Provident Fund Organisation (EPFO), and focus on recognition of first-time employees, and support to employees and employers,” she said. All the three schemes will be implemented by the ministry of labour and employment.

Under the first scheme, one month’s wage, up to a maximum of Rs 15,000 will be provided to all those newly entering the workforce in all formal sectors. The amount will be disbursed as direct benefit transfer in three installments. The eligibility limit will be a salary of Rs 1 lakh per month. The scheme is expected to benefit 210 lakh youth.

The second scheme will incentivise additional employment in the manufacturing sector, linked to the employment of first-time employees. “An incentive will be provided at specified scale directly both to the employee and the employer with respect to their EPFO contribution in the first four years of employment. The scheme is expected to benefit 30 lakh youth entering employment, and their employers,” Sitharaman announced.

The third scheme is an employer-focussed scheme which will cover additional employment in all sectors. “All additional employment within a salary of Rs 1 lakh per month will be counted. The government will reimburse to employers up to Rs 3,000 per month for two years towards their EPFO contribution for each additional employee. The scheme is expected to incentivise additional employment of 50 lakh persons,” she added.

Hailing Sitharaman's announcement of internship to youth in 500 top companies and employment schemes, Ram Kumar Kakani, director of IIM Raipur said: “By integrating financial support for education, robust internship opportunities, and a strong focus on skill development, these measures not only empower our youth but also lay a solid foundation for sustainable growth and innovation.”