_20240723132210_original_image_48.webp)
Finance Minister Nirmala Sitharaman has delivered her seventh consecutive Union Budget at 11 am today, 23 July, during the Budget Session of Parliament.
Significantly, Sitharaman makes history as the first finance minister to present seven consecutive budget speeches, surpassing former Prime Minister Morarji Desai's record of six consecutive budgets from 1959 to 1964. This budget also marks the first full financial budget of the Prime Minister Narendra Modi-led National Democratic Alliance (NDA) government in its third consecutive term.
“India's inflation remains low and stable, approaching the 4 percent target. The Prime Minister’s package includes five schemes and initiatives aimed at creating opportunities for 41 million youth over the next five years, with a central allocation of ₹2 lakh crore. For this year, I have allocated ₹1.48 lakh crore specifically for education, employment, and skill development,” says FM Nirmala Sitharaman.
Following goals set in Interim Budget, FM set nine priorities
Employment & Skilling:
Employment-Linked Incentives: To drive employment and skilling, three major schemes have been introduced, focusing on enrolment in the Employees' Provident Fund Organisation (EPFO) and providing support to both first-time employees and employers.
First-Time Employees: Finance Minister Nirmala Sitharaman announced, “We will provide one month’s wage to all persons newly entering the workplace in all formal sectors. Direct Benefit Transfer of one month’s salary, in three installments, will be given to first-time employees registered with the EPFO, up to ₹15,000. The eligibility limit will be a salary of ₹1 lakh per month, benefiting 210 lakh youth.”
Job Creation in Manufacturing: To boost employment in the manufacturing sector, the government will offer benefits to both employees and employers for the first four years. This initiative is expected to benefit 13 lakh youth by linking additional employment to the hiring of first-time employees.
Support to Employees: An employer-focused scheme will provide additional support for employment within a salary limit of ₹1 lakh. The government will reimburse ₹3,000 per month towards EPFO contributions, encouraging employers to hire more.
“Recognizing these first-time employees through enrolment in the EPFO will favour both employees and employers. The provision of a DBT of up to INR 15,000/—to first-timers in all formal sectors will also incentivize the country's youth, encouraging them to take up employment. As laid out by the government, this will hopefully benefit 2.1 lakh youths. The government’s commitment to helping create jobs for both employees and employers despite challenges from the pandemic is making strides towards a trillion-dollar economy. We look forward to the future that will follow the new schemes laid out by the budget and are proud to support the Yuva pillar of the Viksit Bharat plan,” highlights Ankit Dangi, HR Head, Zoreko
To enhance women's participation in the workforce, the government plans to set up women’s hostels in collaboration with industries and introduce women-specific skilling programmes.
A new centrally sponsored scheme aims to skill 20 lakh youth over a five-year period. This includes upgrading 1,000 industrial training institutes, aligning course content with skill needs and introducing new courses.
The skill-loan scheme will be revised to provide loans up to ₹7 lakh, benefiting 25,000 students annually. Additionally, education loans will support youth who are otherwise ineligible, offering financial aid up to ₹10 lakh for higher education at domestic institutions.
E-vouchers for loans up to ₹10 lakh for higher education in domestic institutions will be issued directly to 1 lakh students annually, with an interest subvention of 3 per cent on the loan amount.
"Allocation of Rs 1.48 lakh crore for education and employment and skill paves the way for optimising the human capital and leveraging demographic dividend. The introduction of wage subsidies for the businesses recruiting employees for the first time is a welcome move that promises to invigorate our employment landscape. Moreover, the provision of education loans with interest subvention schemes stands will build a strong future talent pipeline. Announcement of Rs. 3 trillion for programmes supporting women and girls in terms of setting up working women hostels and crèches is a welcome and timely move to enhance women participation in workforce and economic progress,” comments Indrani Chatterjee, Group CHRO, Allcargo Group.
Inclusive Human Resource Development and Social Justice
The government has prioritised inclusive development with a focus on youth, women and farmers through various schemes and initiatives.
“It is heartening to note that the budget covers increasing women's participation in the workforce with a supportive ecosystem and right-skilling programmes. According to an industry report, India can achieve a GDP growth rate of 8% by ensuring that women account for more than half of the new workforce set to be created by 2030. By creating a supportive environment, with more government initiatives like this, we can further enable women to overcome challenges, enter the workforce, and contribute meaningfully to the economy,” shares Dhara Manoj Vyas, CPO & Head - CSR & HR, Suryoday Small Finance Bank.
PM Vishwakarma Kaushal Samman (PM VIKAS): This scheme aims to provide recognition and support to traditional artisans and craftspeople, enhancing their skills and market opportunities.
National Livelihood Mission: Strengthened to improve employment opportunities and economic conditions, particularly in rural areas. This mission includes training and capacity-building programmes to support self-employment and entrepreneurship.
Stand-Up India Scheme: Continued emphasis on promoting entrepreneurship among women and SC/ST communities, ensuring economic opportunities and financial inclusion.
Women-Led Development: The budget allocates more than ₹3 lakh crore to various women-centric initiatives. This includes the Pradhan Mantri Jan Jatiya Vikas Abhiyan, focusing on the socio-economic development of tribal women. The scheme aims to benefit 5 crore people in tribal regions, providing them with the necessary support to improve their quality of life.
Lakhpati Didi Scheme: This scheme targets women in self-help groups (SHGs), aiming to enhance their earning potential to at least ₹1 lakh per annum per household. By expanding the scheme’s reach, it is set to benefit an additional 2 crore women, driving rural socio-economic transformation.
Infrastructure Development in the Eastern Region: The budget includes provisions for the industrial development of the eastern region, with specific plans for constructing medical colleges and sports academies in Bihar. This initiative aims to boost regional growth and provide better healthcare and sports facilities.
Manufacturing & Services Sector
Labor-Intensive Manufacturing: To support labor-intensive manufacturing, the budget proposes several financing and regulatory changes to streamline operations and foster growth. These measures are expected to enhance productivity and provide a more conducive environment for businesses to thrive.
Internship Scheme for Youth: A comprehensive internship scheme has been introduced, targeting 1 crore youth over the next five years. Under this scheme, 500 top companies will provide 12-month internships, giving young professionals exposure to real-life business environments. Each intern will receive a monthly allowance of ₹5,000, along with a one-time assistance of ₹6,000. Companies will fund these internships through their corporate social responsibility (CSR) budgets. This initiative aims to bridge the gap between academic learning and industry requirements, thereby enhancing employability.
“The comprehensive internship scheme, offering real-world experience to 1 crore youth and supported by CSR funding, is a welcome addition that bridges the gap between education and practical experience. Although these measures are commendable, simplifying apprenticeships could have made a significant impact in skilling the youth. Integrating apprenticeships could further strengthen the link between education and employment by offering structured, hands-on training opportunities. Together, these initiatives are set to address skill gaps, boost youth employability, and cultivate a more skilled and inclusive workforce, driving significant progress in India’s labor market and economic development,” says Sumit Kumar, Chief Strategy Officer, TeamLease Degree Apprenticeship.
Boosting the Shipping Industry: The budget also focuses on the shipping industry as a potential area for significant job creation. Specific policies and incentives are being developed to increase employment opportunities within this sector, ensuring it remains a critical component of India's economic landscape.
The investment in manufacturing and services sector is expected to have a multiplier effect on economic growth and job creation, particularly in areas like urban development, railways and logistics.
“With a growing population that is set to become one of the youngest workforces in the coming years, the emphasis on initiatives to incentivize first-time entrants to the job market is essential. The government's plans to enhance skills, improve infrastructure, and support entrepreneurs are crucial steps to boost job opportunities and the economy. Special incentives for first-time manufacturing employees and employers are particularly promising. As India builds more infrastructure, the demand for skilled workers will increase, creating numerous job opportunities,” adds Sashi Kumar, Head of Sales, Indeed India.
Infrastructure
The government announced a massive outlay for infrastructure development, allocating ₹10 lakh crore for capital expenditure, which is expected to drive growth and generate employment. This includes investments in roads, railways, ports, and airports, aiming to improve connectivity and logistics across the country.
"The PM’s package for employment and skilling aligns perfectly with our industry's need for a skilled workforce to fill the current gap in construction sector labour, especially with the rising demand for specialized skills in modern techniques and technologies. Additionally, the focus on increasing women's workforce participation through initiatives like working women hostels and creches is a welcome step as it creates a supportive environment, addressing work-life balance. This will tap into a larger talent pool and foster inclusivity where women thrive professionally, enhancing diversity and industry resilience,” shares Sheetal Bhanot Shetty, CHRO, Infra.Market.
Tourism has always been a part of our civilisation. The Modi government efforts are to position India as a global destination which will also create jobs and unlock opportunities in other sectors.
Next Generation Reforms
The eShram Portal will be integrated with other digital platforms, creating an open architecture database. This will provide up-to-date information on available job roles and facilitate direct connections between job seekers and employers.
The Shram Suvidha Portal and the Samadhan Portal will undergo a revamp to streamline compliance processes and reduce bureaucratic hurdles for industry and trade.
