India’s Skilling Challenge: Bridging Education, Skills and Employment

Why in News?

• NITI Aayog has released ‘Reimagining Skilling for Viksit Bharat@2047’, which calls for major changes in India’s skill-development system.
• The report highlights the mismatch between education, workforce skills and actual labour-market requirements.

Key Findings

• About 65% of India’s population is below 35 years, creating a major opportunity for a demographic dividend.
• More than 7.67 crore people have received skill-based training since 2014-15.
• However, only about 8.25% of graduates work in jobs matching their qualifications.
• Nearly 65% of people aged 15–59 have no formal or informal training.
• A 2022 NSDC study estimated a shortage of around 29 million skilled workers, particularly in IT, healthcare, BFSI, semiconductor manufacturing and green jobs.
• Only around 8% of Indian firms provide on-the-job training.

Problems with ITIs and Skill Training

• ITIs remain heavily focused on traditional manufacturing trades such as electrician and fitter, while demand is increasingly shifting towards services, AI, automation and green technologies.
• Many ITI seats remain vacant because of outdated courses, social perceptions, gender-based occupational choices and inadequate infrastructure and instructors.
• The expansion of ITIs has not always resulted in better quality or employment outcomes.
• Skill courses have also become shorter in many cases, reducing their ability to provide meaningful employment-oriented skills.

Way Forward

• Introduce vocational education and employability skills from school to university.
• NITI Aayog proposes ‘Kaushal Tracks’ from Class 9 onwards, linked to local and national employment demand.
• Strengthen apprenticeships and work-integrated degree/diploma programmes.
• Update ITI curricula according to industry needs and expand courses in AI, automation, electric vehicles and green technologies.
• Promote upskilling within existing occupations and reskilling for workers moving to new occupations.
• Improve women's participation by addressing gender-based perceptions of occupations.
• Increase investment in both general and vocational education.
• Learn from models such as Germany’s early vocational education system.

Human Capital Perspective

• Gary Becker linked investment in education and training with higher skills, earnings and employability.
• Theodore Schultz viewed education and training as long-term investments in human capital.
• For India, effective skilling can help convert its large young population into a demographic dividend.

About NITI Aayog:

• NITI Aayog (National Institution for Transforming India) is the Government of India’s premier policy think tank. 
• It provides strategic and policy advice to the Centre and States and supports long-term development planning. 
• Its core role is to provide directional and strategic inputs and act as a platform for developing innovative policy ideas. 

Origin

• The Planning Commission was established in March 1950 to formulate and oversee economic planning through Five-Year Plans. 
• Over time, it was criticised for its centralised and rigid approach and for not adequately addressing the diverse needs of States. 
• The Planning Commission was discontinued on 13 August 2014. 
• NITI Aayog was established on 1 January 2015 as its successor. 
• It was created through an Executive Resolution of the Union Government. 
• Therefore, NITI Aayog is neither a Constitutional Body nor a Statutory Body. 

Composition

• Chairperson: Prime Minister of India — ex-officio. 
• Governing Council: Includes: 
  • Chief Ministers of all States. 
  • Chief Ministers of UTs having legislatures — Delhi, Puducherry and Jammu & Kashmir. 
  • Lieutenant Governors of UTs without legislatures. 
• Regional Councils: 
  • Created for a specific period to address issues affecting multiple States or regions.
  • Convened by the Prime Minister when required. 
  • Consist of relevant Chief Ministers and Lieutenant Governors. 
  • Chaired by the Prime Minister or his/her nominee. 
• Special Invitees: Experts, specialists and practitioners nominated by the Prime Minister. 

Full-Time Organisational Structure

• Vice-Chairperson: Appointed by the Prime Minister; enjoys the rank of a Cabinet Minister. 
• Full-time Members: Enjoy the rank of Minister of State. 
• Part-time Members: Up to 2, drawn from universities, research institutions and other relevant organisations. 
• Ex-officio Members: Up to 4 Union Ministers, nominated by the Prime Minister. 
• CEO: Appointed by the Prime Minister for a fixed tenure; holds the rank of Secretary to the Government of India. 
• Secretariat: Established as considered necessary.

Practice Question 

Q. Consider the following statements regarding NITI Aayog and India’s skilling system:

1. NITI Aayog is a statutory body established through an Act of Parliament as the successor to the Planning Commission. 
2. The Governing Council of NITI Aayog includes the Chief Ministers of all States and the Chief Ministers of Union Territories having legislatures. 
3. NITI Aayog has proposed introducing ‘Kaushal Tracks’ from Class 9 onwards, linked to local and national employment demand. 
4. The CEO of NITI Aayog is appointed by the Prime Minister and holds the rank of a Secretary to the Government of India. 

Which of the statements given above are correct?

(a) 1 and 2 only
(b) 2, 3 and 4 only
(c) 1, 3 and 4 only
(d) 2 and 4 only

Answer: (b) 2, 3 and 4 only

Explanation

• NITI Aayog was established through an Executive Resolution of the Union Government and is neither a Constitutional nor a Statutory Body. Hence, Statement 1 is incorrect. 
• The Governing Council includes the Chief Ministers of all States and the Chief Ministers of Union Territories having legislatures. Hence, Statement 2 is correct. 
• NITI Aayog has proposed ‘Kaushal Tracks’ from Class 9 onwards, aligned with local and national employment requirements. Hence, Statement 3 is correct. 
• The CEO of NITI Aayog is appointed by the Prime Minister for a fixed tenure and holds the rank of Secretary to the Government of India. Hence, Statement 4 is correct.