In a bid to enhance skill development and create a pool of employable youth, the Union Budget 2024 has introduced a new internship scheme aimed at 500 top companies across India. This initiative is designed to provide valuable work experience and training for young individuals, helping them prepare for future employment.

Key Details of the Internship Scheme

1. Eligibility Criteria

Age: Applicants must be between 21 to 24 years old.

Employment Status: Candidates should not be employed or engaged in full-time education.

Exclusions: Graduates from prestigious institutions like IIT, IIM, IISER, CA, or CMA are not eligible. Also, candidates whose family members are income taxpayers or government employees are excluded.

2. Internship Duration and Structure

Period: The internship lasts for 12 months.
Experience: Interns are expected to gain hands-on experience related to the organization’s core activities. At least half of the internship should involve actual work experience rather than classroom training. Organizations that cannot provide direct experience must collaborate with partners in their supply chain or other affiliated institutions.

3. Government Subsidy and Costs

Monthly Allowance: Interns will receive a monthly allowance of INR 5,000, totaling INR 60,000 for the entire 12-month period.

Additional Payment: A one-time incidental grant of INR 6,000 will also be provided.

Government Contribution: The government will cover INR 54,000 of the allowance and INR 6,000 for incidentals. Companies will need to contribute INR 6,000 (10% of the allowance) plus any additional training costs from their Corporate Social Responsibility (CSR) funds. Administrative expenses related to the internship can also be covered by CSR funds.

4. Application and Selection Process

Portal: Applications will be managed through an online portal.
Selection: Organizations will choose interns from a list provided on the portal, prioritizing candidates with lower employability prospects.
Practical Considerations

Compliance with Existing Laws: Organizations must still meet the requirement to engage 2.5% of their workforce as apprentices under the Apprentices Act, 1961. It remains to be seen whether this new internship scheme will be in addition to or replace this statutory requirement.

Top 500 Companies: The criteria for selecting the top 500 companies participating in the scheme are yet to be clarified.
Internship Limits and Allowances: Further details are needed on whether there are limits on the number of interns a company can host and if organizations can offer allowances higher than the stipulated minimum.

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