Skills Development in India: a Daunting Task

By Indu Grover, CCS Haryana Agriculture University, Hisar, India.

indiaEducation and skills, the foundation of human capital formation, are the key driving forces for socio-economic development. The Indian economy had a Hindu rate of growth (sic) for decades, before it opened up in 1991 with periods of ups and downs. Since May 2014, under the government of Prime Minister Narendra Modi, the almost stagnant economy has started picking up fairly rapidly. The economy remains huge, but only 11% of the workforce (40 million people) are in the organized (formal) sector and the majority work in the unorganized (informal) sector. Meanwhile, India’s HDI ranks 134 out of 180 countries, revealing poor performance on this crucial indicator.

The IMF chief, Christine Lagarde, recently noted India’s growth potential and said that India must seize the opportunity. India’s growth story reveals that since independence till recently, the focus has been mainly on education rather than the vocational skill acquisition of the workforce. However, the potential for skill development caught the imagination of policy makers during the Eleventh Five Year Plan (2007-12). The target group for skill development comprised all those in the labour force, including those entering the labour market for the first time (12.8 million annually), those employed in the organized sector and those working in the unorganized sector (433 million). A target of skilling 500 million people by 2022 was set.

In February 2009 the Ministry of Labour and Employment approved the National Policy on Skill Development (NPSD). The game-changing delivery mechanism was conceived through setting up 50,000 Skill Development Centres and involving public-private partnership to generate skills at lower cost. The policy scheme appears to challenge even the wish list of politicians as it has targeted increasingly the proportion of formally and informally skilled workers in its total work-force from a mere 2% now to 50% by 2022, thus creating a 500 million strong resource pool and the hope of profiting from a ‘demographic dividend’.

India’s shocking 2% per cent skilled workforce with formal training in the organized sector and 10% in the unorganized sector compared with 45% to 95% trained manpower in the formal sector among neighbouring Asian Tigers and several developed countries is glaring. Unni (2011) comments that there is a compelling need to launch a world class skill development programme in Mission mode that can be scaled up quickly to cover the whole country. However, during the Eleventh Plan period the set target could not be achieved as most time was spent in framing modalities and action plans; a move from training the few to training the majority in the workforce required an innovation.

To quote the Minister for Skill development and Entrepreneurship, Rajiv Pratab Rudy (April 2015):

The focus all these years has been on education or degrees. Sixty-six years have been lost. We never thought about skills. We only thought about education, and the outcome is for all to see.

The total workforce is around 550 million people. If we leave those employed with agriculture, which is 54 per cent people, we are left with approximately 250 million people. And there are 10 million people joining the workforce every year. You are handling around 300 million people which you have to train over the next five years. And this is a conservative estimate. The resources which will be required are huge. It’s a challenge, it’s a very daunting task.

The proposal of the National Commission for Enterprises in the Unorganised Sector (NCEUS) which was to provide entitlements to all registered youth in the unorganized sector to receive training through placement did not see the light of the day and NCEUS closed down in 2009. Should the large majority of the workforce employed in the unorganized sector be deprived of skill training or be left unattended? Though a few individuals, NGOs, industrial houses, companies and government programmes provide skill training for employment generation, these are not enough. The quality of the training delivered is another matter of grave concern. Unni (2011) comments again that though there are currently many development initiatives underway, supporting on the job training in the massive unorganized sector should be a priority as this is where most jobs for the youth are created.

One must take into account the fact that the age old caste system that hierarchically divides Indian society on the basis of professions on a gradient from knowledge to vocational occupations, places lesser value and prestige on vocational skills, has hindered growth and popularity of technical and vocational education and training (TVET). Reports and surveys repeatedly reveal the abysmal state of affairs of schooling and TVET, especially in rural areas where the majority live. India must expand TVET to cater to the majority already in the labour force who have informally acquired skills, so that recognition of prior skills and learning becomes systemic (Mehrotra, 2015). India will not be able to reap benefits of any “demographic dividend” without skilling. The faster the better.

The Constitution of India (1950) provides for free and compulsory education to children between 6-14 years of age, and a Right to Education Act was passed in 2009 to make elementary education the fundamental right of all 6-14 years old. However, 34.5 million children remain out of school, school infrastructure targets are far from satisfactory (functional toilets, playgrounds, boundary walls, dual desks and chairs,  libraries, potable water), millions of teacher vacancies exist and contract hiring continues (Tendon, 2015). Further, on the quality front learning leaves much to be desired. What a tremendous waste of resources and manpower occurs on this account despite the fact the children attend school and are willing to acquire knowledge, skills or both. Who is responsible for this pathetic state of affairs? The budgetary allocations to the education and TVET sectors remain fairly low compared with China, Korea and other Asian drivers and developed countries. Consequently, in their formative years children miss out on education and skills and then drift into a vicious circle of illiteracy, poverty, violence and crime. The society bears the brunt of this neglect. Who is to be blamed? Nobel laureate Kailash Satyarthi is of the view that, ‘Any society’s future will be only as good as the way it treats and nurtures its children today’.

By investing in innovative approaches to skill provision at school and higher levels, combined with skilling and reskilling those already working in the organized and unorganized sector, India could see an economic renaissance like other developed nations – and why not? If skilled workers don’t become available to industry at a rate comparable to the growth of demand for skills, manufacturers will increasingly resort to more capital-intensive technologies, which will lock India into a pattern of growth that is out of synch with its comparative advantage – relative abundant labour power (Mehrotra, 2015).

The country is eyeing three engines of job creation – manufacturing, IT and infrastructure. The urgent need for skilled workers gets more crucial by the day to move the country on the fast track to development. The mind boggling questions arising are: Is India prepared and willing enough for this gigantic task and to make the right investment and effort in human resource development? Can it earmark greater resources for skilling, develop infrastructure and institutional mechanisms to foster skills, and explore new partnerships? And, is the 500 million target achievable within the timeframe set?

The role played by India as a non-DAC partner in training thousands of  professionals and officers under Indian Technical and Economic Cooperation from several countries in Asia, East Europe, Central Asia, Africa and Latin America, Special Commonwealth Assistance for Africa Programme, and other international programs, besides giving thousands of scholarships fellowships and establishing specialized institutes is African countries is commendable (Grover, 2011). However, King (2011) questions what model of skill development is being proposed abroad when until recently so little was done at home. Furthermore, entrepreneurship and self employment have to play a big role going forward in making India a nation of job creators, not just job seekers (Venkatesan, 2015).

Mehrotra (2015) points that though less than 10% of the workforce has acquired vocational skills, that proportion is higher if we take only the non-agricultural workforce into account (20%), and even higher if we take only the industrial workforce into account (44%).  India’s skill development system includes a very narrowly based pre-employment training system of Industrial Training Institutes; a rapidly growing number of formal vocational training providers set up after 2010; vocational education offered in senior secondary schools and finally, in-firm training provided on recruitment by companies (but only 16% of Indian companies provide such training, and that too only large ones, in contrast to 85% of firms in China). Only large firms offer apprenticeships, and in a country with a workforce of 485 million, there are under 300,000 formal apprentices.

Today, several new programmes being initiated in the country, for example: Make in India, creation of 100 smart cities, Digital India, housing for-all by 2020, infrastructure development and up-gradation, railway modernization, space science exploration,  creation of new ports and airports, clean and renewable energy, clean Ganges mission, Heritage Development and Augmentation Yojana etc. need millions of skilled workers.  Furthermore, as foreign investors are keen to invest, skilled workforce would be an asset and an attraction. As the Indian economy could expand at speed, millions of jobs will be available only for a skilled workforce. Training and skilling will need to be tackled on a war footing. Delay will prove too expensive and opportunity missed will be missed forever.

It’s high time that government, industry, private vocational and technical training providers and others involved need to work together to realize this dream. This achievable dream appears a “distress wake up call for skill development” and unless the action is initiated on a “war footing” the “skilling battle” may be lost.

Indu Grover is a Retired Professor cum Dean, Department of Extension Education and Communication Management, CCS Haryana Agriculture University, Hisar, India. Email: indugrov@gmail.com

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