Why Modi govt's flagship internship scheme is off to a stuttering start with low turnout, high attrition

The Print

13-05-2025

However, just four months later, he quit in disappointment.
Armed with an internship offer letter from DSP, he thought he would be better equipped to navigate the challenging job market.
New Delhi: When Aman Mashi Soy, a commerce graduate, joined SAIL's Durgapur Steel Plant (DSP) in December 2024 under the Modi government's flagship Prime Minister Internship Scheme (PMIS) launched in October 2024, he saw it as an opportunity for a better future.
'I was not finding value in the work that was given to me… So once a better opportunity came, I quit,' Soy told ThePrint over the phone from West Bengal.
He said the work assigned to him was mostly related to data entry, filling papers and maintaining files. 'This is not the work I was looking for when I applied for the internship,' he said.
The steel plant in Durgapur, West Bengal, saw 40 candidates joining in December 2024 under the PMIS. Of this, eight have already left.
Another candidate, who did not want to be named as he is still interning with DSP, told ThePrint he isn't hopeful the type of work he is doing will help him find a job in the future.
'The work that I am doing is not adding to my technical skillset. I am not sure what to do', he said.
ThePrint spoke to over half a dozen candidates who joined the Modi government's flagship internship scheme announced by Finance Minister Nirmala Sitharaman in Budget 2024-25.
Jyotish Hazarika, a diploma holder in electrical engineering, took an internship at ONGC in December 2024 and left after three months. Based in Assam, he told ThePrint that he found an apprenticeship with better work and salary.
While some like Soy and Jyotish left, others, in the absence of better opportunities, are continuing.
The PMIS aims to provide internships to 1 crore youth for the next five years. The aim is to equip the country's young population living in tier 2 and tier 3 cities with the necessary skills enabling them to prepare for future employment.
The scheme entails giving a one-year on-the-job training to aspirants with a monthly stipend of Rs 5,000 to be shared by companies (Rs 500 via CSR fund) and the government (Rs 4,500). Apart from a stipend, the government will pay a one-time grant of Rs. 6,000 to candidates.
Despite high initial interest, the scheme has been plagued by early hurdles since its first round was launched in October 2024, including low acceptance of offers, high attrition and complaints of low-quality work for some candidates.
A parliamentary panel flagged multiple structural issues, including a mismatch of roles, location constraints and long internship tenure.
As the second round rolls out with new features, the Ministry of Corporate Affairs is aiming to plug gaps.
The first round, which was more of a pilot phase, ended in December 2024.
Only 8,725 candidates physically joined out of the 1.27 lakh internship opportunities offered by 280 public and private companies, according to a parliamentary committee on finance report on Demand for Grants (2025-26) of the Ministry of Corporate Affairs (MCA) tabled on 19 March 2025.
The report acknowledged that factors such as a mismatch of roles, a higher age limit for Industrial Training Institute (ITI) and polytechnic graduates, location constraints such as relocation or long-distance travel, and the scheme's 12-month tenure contributed to the low acceptance rate. '
A January 2025 survey by education consulting firm TeamLease EdTech, 'The Role of CSR in Transforming Education into Employability', which covered 932 companies, found that nearly 73 percent of firms considered one to six months an optimal duration for an internship.
Meanwhile, the funds allocated for the first round of the PMIS remained largely underutilised — of the Rs 2,000 crore initially earmarked for FY25, which was later revised to Rs 380 crore, only Rs 21.1 crore had been spent till February 2025.
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Low acceptance, high attrition
The low acceptance among candidates, along with high attrition, has become a cause for concern among authorities, who are working behind the scenes to fix the gaps in the second round.
During the first PMIS round, partner companies offered 1.27 lakh internship slots, attracting 6.21 lakh applications from 1.8 lakh candidates.
Of these, the companies extended 82,000 offers, but only 28,000 were accepted, according to the report by the Standing Committee on Finance report. Ultimately, only 8,725 candidates joined—only 7 percent of the total internships on offer.
A senior MCA official told ThePrint that many candidates were unfamiliar with the concept of internships, which became apparent during feedback sessions held after the first round.
'For many, this was their first time building a CV or working in a professional setup,' said the official, who did not want to be named.
Apart from low acceptance of offers, companies also saw high attrition. The reasons varied from low quality work to no assurance of future employment in PSUs and the need for a better salary for higher studies.
Some companies ThePrint spoke to said that while the quality of work being offered is subjective, there are cases of poor-quality work.
However, many are offering meaningful work.
Aditi Kashyap, an intern at the ONGC processing centre at Jorhat, Assam, expressed satisfaction with the work. A physics honours graduate, she is currently studying seismic data from the sea at ONGC using industrial software.
'I am satisfied with the work. Learning industrial software from a big company like ONGC will add to my skillset and resume for future employment opportunities,' she told ThePrint.
However, despite offering qualitative work, even ONGC has seen attrition among interns.
Of the 539 candidates who physically joined ONGC in December last year, 443 remain. A total of 96 candidates have left without completing the 12-month tenure, citing varied reasons.
ONGC had offered 6,020 internship opportunities in the first round, the highest for any PSU.
'Attrition could be due to multiple reasons. Many candidates leave to pursue higher studies, a better salary or full-time employment. Being a public company, we cannot commit permanent jobs to PMIS candidates after completion of a 12-month internship,' Anil Kumar Bahuguna, Chief of Skill & Development at ONGC, told ThePrint.
Bahuguna said nearly 80 percent of round one interns at ONGC were deployed in the field – including rigs, processing centres, basin offices and stations – to ensure better training and knowledge.
'We plan to deploy 100 percent of round two candidates to the field,' he added.
The TeamLease EdTech survey also highlighted that 81 percent of the companies are backing the PMIS, while 70 percent of companies are keen on offering full-time jobs to up to 10 percent of candidates. Most of these are private companies.
'A large number of the surveyed companies were private entities (only a few of them being public listed entities), spread across small cap, medium cap and large cap entities, who expressed their intent to hire 10 percent of interns into their organisation', Shantanu Rooj, CEO of TeamLease Edtech, told ThePrint.
'It is heartening to notice that these companies would like to give back 90 percent of the trained resources to the industry, which can help boost the talent supply channels for the industry at large,' he added.
ThePrint reached out to representatives of private companies but did not receive any response. This report will be updated if and when they respond.
Round two to have new features
Learning its lesson from round one, the Ministry of Corporate Affairs (MCA) has made several changes in round two to make the scheme more viable and transparent.
Registration for the second round started on 9 January this year and closed on 22 April.
The deadline was extended multiple times without citing any official reasons. However, according to MCA officials, the extension was aimed at giving candidates more time to apply, as outreach programmes were still being organised.
So far, more than 1.18 lakh internship positions have been listed under the second PMIS round across more than 700 districts by 310 companies, according to ministry sources.
In the second round, candidates can see more details about internship positions on the PMIS portal, such as company name, additional benefits and exact work location through geo-tagging. This will help candidates make an informed choice.
'Key upgrades include greater transparency as candidates can now view company names, any additional benefits offered, and the exact internship location using GIS technology. They can now also look for internships near their homes by entering a preferred distance from their place of residence,' the senior MCA official overseeing the scheme's implementation.
These additional features were absent when the scheme was launched.
Now candidates can choose from three internships instead of five as earlier. According to the MCA official, the change was aimed at reducing confusion and curbing the high volume of applications that often led to rejections due to mismatches between candidates' backgrounds and the roles on offer in the first round.
More than 100 physical outreach events were organised during the second round across districts in collaboration with state governments, urban local bodies, education and skilling institutes (based on the qualification required for internships in the location) and other district-level ecosystems.
The MCA organised targeted campaigns by the MCA to build awareness about the PMIS through open houses, which are live sessions with candidates, and information, education and communication (IEC) events.
'In this round, we also relied more on youth-centric digital platforms like YouTube and Instagram to generate awareness and engagement in a targeted manner. In addition, we also organised a series of open-house sessions to guide interested candidates by helping them understand the benefits of the scheme and answering their queries live,' said the senior MCA official.
Lack of additional benefits and delayed stipend
Under the scheme, candidates received a one-time grant of Rs 6,000 and a monthly stipend of Rs 5,000, which would be shared by the company and the government.
However, for many candidates, meeting expenses over and above the stipend amount is not feasible, at least for outstation candidates.
While some companies are offering additional benefits to candidates, many are holding back.
But a senior MCA official said the PMIS is a voluntary scheme for both candidates and companies. There are no guidelines about additional benefits from the government.
'Companies are given full flexibility to offer higher financial assistance and additional benefits. Over 180 companies have already done so, offering additional benefits such as additional financial assistance, accommodation, travel and/or food allowance,' said the MCA official.
ONGC, for instance, offers other benefits, including Rs 5,000 for food each month, a monthly rent of Rs 5,000 for outstation candidates and free transport.
'I would urge more companies to offer additional benefits to the interns under this scheme as it would motivate candidates and ensure higher participation. At ONGC, we are offering rent allowance to outstation candidates and food allowance for all,' said ONGC's Bahuguna.
Similarly, Manappuram Finance is offering an additional stipend to its PMIS candidates. The company will provide Rs 500 per month for the first three months, Rs 2,500 for the next three, Rs 5,000 for months six to nine, and Rs 7,500 for the final quarter.
Another common issue faced by candidates is that the stipend of Rs 4,500, which is borne by the government, is usually delayed.
Candidates have raised concerns on the PMIS portal about payment delays.
Candidates can file internship-related complaints through the grievance section of the PMIS portal by logging into their accounts.
MCA officials and company representatives told ThePrint that the payment process is time-consuming. The company needs to mark candidates eligible for payment every month, based on attendance and other factors, and make their share of payment. Then the MCA releases its share based on the Aadhaar-seeded account of the candidates through Direct Benefits Transfer.
Though ministry officials acknowledged instances of delay, but highlighted that some of it is because many candidates either did not have Aadhaar-seeded bank accounts or were checking other bank accounts while the amount had been credited to their Aadhaar-seeded account.
Efforts are underway to improve the payment process.
'We have recently integrated the PMIS portal with the Public Finance Management System to ensure a more streamlined process. We have also established a robust grievance redressal mechanism on the portal and set up a multi-lingual helpline centre (both inbound and outbound calling) to provide timely information,' said the MCA official.
Professor K.R. Shyam Sunder, who teaches at the Gurugram-based Management Development Institute, told ThePrint that the PMIS scheme must offer at least the applicable minimum wage rate for a state. He also called for the scheme to include candidates across income levels.
'Skills are essential for candidates across income brackets,' he said.
He further added that internship tenure must not be more than six months. Also, if the scheme becomes part of the curriculum at institutes, then candidates would be motivated to join the scheme to get academic credits.
However, government officials and industry players are optimistic about the scheme's success, saying it's still early days. For FY26, the government has set an ambitious target of providing internships to 15 lakh candidates (1.25 lakh per month) with an allocated budget of more than Rs 10,000 crore.
Udit Bubna is an intern who graduated from ThePrint School of Journalism.
(Edited by Sugita Katyal)
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