New public-pvt plan to raise 1 million skilled workforce

India plans to launch a programme to create what the world needs most: skilled workers. It plans to spend Rs 555 crore on a million people to train them or test and certify their existing skills so that they are globally accepted.

The Ministry of Labour & Employment has proposed that the Skills Development Initiative (SDI), to be taken up through public-private partnership, be fully funded by the Centre with the industry providing technical assistance. Besides providing better employment and higher productivity, the SDI is being targeted as a "unique opportunity to complement what an ageing Rest of the World needs most i.e. productive workers," says the proposal.

India has the youngest population with the median age of 24 years in 2000 compared to 30 years in China, 38 in Europe and 41 in Japan. Since only 5 per cent of India's 20-24 age workforce has had vocational training, the gains would be vast if the level is raised to 60 per cent — the rate achieved by industrialised countries. The World Bank's "Doing Business" survey says that India's own demand for specific skills is also very high, and often unmet. And this could hamper sustaining the high growth rates in the face of international competition.

Recognising this problem of high unskilled labour supply and the resultant low wages and under-employment, Finance Minister P Chidambaram announced the SDI in the 2005 Budget with the promise to spell out its details shortly. That scheme is now ready with the Centre willing to invest Rs 5,000 per person to train them at the Industrial Training Institutes (ITIs) and centres (ITCs).

Funding to ITIs and ITCs will help utilise their existing spare infrastructure while providing them extra funds to improve their running. With new jobs expected to come from the informal sector and the overseas market, the percentage of skilled workforce would get augmented along with better collaboration with private industries. The states, which administer the ITIs, have concurred with the proposal. It now requires Cabinet approval.

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