TURN OF THE INTERN

Can India Inc absorb 10 million interns over 5 years?

- KRISHNA KANT

India Inc's annual expenditure on corporate social responsibility (CSR) projects is more the than sufficient to cover cost of hiring and training 10 million interns over the next five years, according to this year's Union Budget, presented on July 23. One of its proposals is that India's 500 largest companies will be encouraged to hire 2 million interns a year for the next five years, with the option to use CSR funds to cover 10 per cent of the annual costs associated with these internships.

According to the Companies Act, 2013, companies are required to spend at least 2 per cent of their average net profit over the preceding three years on CSR activities and projects.

Under the programme proposed in the Budget, each intern will receive a monthly allowance of ₹5,000 for a year, in addition to a onetime financial assistance of ₹6,000 for incidental expenses. The companies are expected to bear only 10 per cent of the monthly allowance; the rest will come from taxpayers as subsidy.

Each company will contribute ₹500 a month to an intern from its CSR fund, and the government will cover the remaining 4,500. The companies are also expected to bear the cost of the training and administrative expenses.

Absorption challenge