The scheme was launched as a pilot project in Kerala last week.
Minister for Overseas Indian Affairs Vayalar Ravi said the scheme is meant to enhance the social security net and rehabilitation plans of poor Indians working abroad and has several important features.
"Besides providing life insurance cover, the scheme, jointly managed by LIC, UTI and Bank of Baroda, is aimed for workers holding ECR (Emigration Check Required) passports. It will help them save for old age and provide financial security," Ravi told Times of Oman.
PILF is meant for Indian workers aged between 18 and 50 years who have a work permit or employment contract and whose passports carry the 'Emigration Clearance Required' stamp.
The pension will commence after they cross the age of 60.
Initially, a worker has to pay Rs 5,000 to become a beneficiary of this plan. The government will contribute Rs 2,000 from its kitty. If the person is a domestic help, the amount would be Rs 3,000.