Silencing the critics, the Narendra Modi government on Tuesday allocated a whopping `2.10 lakh crore for job creation and also likewise amount of `1.52 lakh crore for agriculture and allied sectors to address the employment issue for which the BJP Government have faced flak during the last two tenure.
Both the schemes, as announced by Finance Minister Nirmala Sitharman in her Budget, for employment will be based on enrollment in the EPFO [Employees’ Provident Fund Organisation] and focus on first time employees and employers.” The scheme is expected to benefit 210 lakh youths. The second scheme for job creation in manufacturing will incentivise additional employment in the manufacturing sector, linked to the employment of first-time employees.
The scheme will provide incentives for companies, including paying for one-month salary for first-time employees, incentive at specified sale to both employee and empower with respect to their retirement fund contribution in the first four years of employment and reimbursing employers up to `3,000 per month for two years towards EPFO contribution of each additional employee.
There is also a sense of urgency since the BJP is gearing up to face elections in key states such as Maharashtra, Haryana, and Jharkhand where the party had suffered setbacks in the Lok Sabha elections.
The Modi 3.0 budget is also an indication that the government will look at job creation more intensely, a politically significant cue since unemployment and jobless growth had been the key themes of the Opposition narrative in the run-up to and during the campaign which they believe struck a chord.
Sitharaman introduced three schemes for employment-linked incentives, targeting the recognition of first-time employees and providing support to employers by internship opportunities in 500 top companies to one crore youth in five years, there is a clear stress on job creation.
The finance minister said the Centre would allocate Rs 2 trillion to create jobs over the next five years. To spur employment, it will roll out incentives for companies, including those in manufacturing, along with programmes to improve skills and provide subsidised loans for higher education, Sitharaman added.
India’s official unemployment rate in urban areas is 6.7 per cent, but the private agency, the Centre for Monitoring Indian Economy, pegs it higher at 8.4 per cent.
The First Timers scheme will provide one-month wage to all persons newly entering the workforce in all formal sectors. “The direct benefit transfer of one-month salary in three instalments to first-time employees, as registered in the EPFO, will be up to Rs 15,000. The eligibility limit will be a salary of Rs 1 lakh per month.
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. The third scheme will be employers focused that cover additional employment in all sectors.
“All additional employment within a salary of Rs one lakh per month will be counted. The government will reimburse to employers up to Rs 3,000 per month for 2 years towards their EPFO contribution for each additional employee. The scheme is expected to incentivize additional employment of 50 lakh persons,” she said.
As the BJP was facing farmers’ backlash over the MSP issue over the past few years and seeing its Lok Sabha tally dip in a state such as Haryana and Maharashtra, the finance minister said Rs1.52 lakh crore will be alloted for agriculture sector.
Moreover, the minister added that the government will release new 109 high yielding, climate resilient seeds for 32 field and horticulture crops. The finance minister said in the next two years, one crore farmers across the country will be initiated into natural farming supported by certification and branding.
“Implementation will be through scientific institutions and willing gram panchayats. 10,000 need-based bio-input resource centres will be established. For achieving self-sufficiency in pulses and oilseeds, we will strengthen their production, storage and marketing. As announced in the interim budget, a strategy is being put in place to achieve ‘atmanirbharta’ for oil seeds such as mustard, groundnut, sesame, soybean, and sunflower”.
“Large scale clusters for vegetable production will be developed closer to major consumption centres. We will promote Farmer-Producer Organizations, cooperatives and start-ups for vegetable supply chains including for collection, storage, and marketing. The details of 6 crore farmers and their lands will be brought into the farmer and land registries. Further, the issuance of Jan Samarth based Kisan Credit Cards will be enabled in 5 states,’ the finance minister said.
