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Govt weighs inclusion of MSMEs in PM Internship Scheme

Govt weighs inclusion of MSMEs in PM Internship Scheme


The union ministry of corporate affairs, the nodal ministry for the initiative, is discussing the inclusion of micro, small and medium enterprises (MSMEs), according to two officials aware of the development, who spoke on the condition of anonymity. The changes to the scheme being discussed may be announced in the upcoming Union Budget for 2025-26, the officials said.

Bringing MSMEs under the internship scheme, which provides a government-funded stipend and a one-time payment to interns hired by companies, could yield better results. MSMEs, which currently employ over 247 million people, accounting for over a third of India’s employment.

While the scheme received an overwhelmingly positive response after it was announced in the full budget in July 2024, the target of generating two million internships every year is challenging. As of 20 January, the government has generated over 125,000 internship opportunities under the pilot, the scheme’s dashboard showed.

Also read | PM internship scheme likely to be modified

“MSMEs can provide internships in large volumes, just because of the large number of enterprises in the country,” said Vinod Kumar, president of industry lobby India SME Forum. “MSMEs face a crucial issue of attrition. But at the same time, they can be used by the youth as training grounds, which will allow them to scale up and get bigger opportunities at larger corporations.”

The scheme aims to provide 10 million internships to the youth in the top 500 corporations by corporate social responsibility (CSR) spending in the country over the next five years.

Each internship lasts 12 months, and every intern gets a monthly stipend of 5,000, of which 4,500 is provided by the government, and 500 by the industry. Additionally, every intern receives a one-time payment of 6,000 once they secure an internship.

Also read | Mint Primer | PM Internship scheme: will it be a game changer?

The plan is to include MSMEs, which are part of the value chain of large corporations, and allow them to generate demand for internships, the officials quoted earlier said.

“For instance, if a large corporation which is a part of the scheme has three MSME suppliers in its value chain, then those MSMEs can also become a part of the scheme by working in tandem with the large corporation,” said one of the officials mentioned above.

Queries emailed to the ministries of finance, corporate affairs, and MSME did not elicit a response till press time.

Job creation is a major challenge for the government, a key issue raised by the opposition during the general elections last year. After the NDA government took office for the third consecutive term, the full budget for FY25 focused on employment and skilling.

Also read | PM Internship Scheme may be opened to youth aged 18-25 to boost work experience opportunities

Over 58 million MSMEs are registered on the government’s Udyam portal, including the Udyam Assist Platform. These enterprises employ more than 247 million individuals, according to the portal’s dashboard.

In comparison, India has about 1.8 million companies registered under the Companies Act, according to information disclosed by the ministry of corporate affairs in its November 2024 report.

Among MSMEs, nearly 12 million are manufacturing businesses, while more than 20 million operate in the services sector, the data showed.

Mint earlier reported that the internship could see a host of changes before it is officially launched.

And read | Over 155,000 candidates register for PM’s internship scheme in first phase; 80,000-plus positions on offer



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