The Union Cabinet has officially approved the Employment-Linked Incentive (ELI) Scheme, allocating nearly ₹99,446 crore (~US $11.7 billion) to generate approximately 35 million new formal-sector jobs over a two-year period beginning August 1, 2025, and running through July 31, 2027.

Eligible to receive a one-time wage subsidy equal to one month’s salary (max ₹15,000), paid in two halves—after six and twelve months.

Only applicable to employees registered under EPFO, earning up to ₹1 lakh/month.

A portion of the subsidy will be held in a savings instrument to encourage financial discipline

Employers get monthly incentives of ₹1,000–₹3,000 per new hire (depending on salary slab) for each additional employee retained for at least six months, continuing for two years.

• ₹1,000 for wages up to ₹10,000, ₹2,000 for ₹10–20k, ₹3,000 for ₹20k–₹1 lakh/month

Manufacturing firms receive an extra two years of benefits (total of four years).

1. Firms with <50 employees must add at least 2 staff.
2. Firms with ≥50 employees must add at least 5 staff

sources