GSS Session I Mr. Dilip Chenoy Strategy for Skill Development: Government Perspective


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  • NSDC funding is across the spectrum - from start-ups to established ventures for scale up. However to convince large corporates in unrelated businesses to get into the skills businesses is a challenge we have undertaken. We are hoping to get at least 5 such companies into the fold this year, of which we have already partnered two.
  • The 30 training organisations funded through NSDC would skill 565 lakh persons in the next ten years creating capacity of 112 Lakhs per annum at full scale which is ~3x the capacity that exists in India The total amount committed from the NSDF Corpus is Rs 1016 Crores.
  • NSDC has a ten year business plan which clearly defines targets for the type of proposals that we need to reach the target of 1500Lakh people by 2022. We have met the targets on the number of proposals in 2010-11 and we hope to keep on delivering. Would like to thank the Government and the Ministry of Finance for support extended
  • One of the biggest challenges that our partners face is to get students to fill the classroom. There is just not enough respect for Vocational training in the country today. To that end it is important to work towards a national campaign that would make skills aspirational In additional India’s participation in the World Skills competition should motivate many youngsters across trades NSDC in partnership with CII, E&Y and ISB is launching an enterprise plan competition across the leading graduate and post graduate schools in India to encourage young minds to think of entrepreneurship as a business.
  • GSS Session I Mr. Dilip Chenoy Strategy for Skill Development: Government Perspective

    1. 1. Strategy for Skill Development : Government Perspective 4 th Global Skills Summit 15 September 2011 New Delhi Dilip Chenoy, MD & CEO, NSDC
    2. 2. Agenda The Indian skills landscape and the journey so far The way forward
    3. 3. The National Skills Policy broadly defined 4 major areas for India to achieve its target for 2022 <ul><li>Does not discriminate between private or public delivery and places importance on outcomes, users choice and competition among training providers and their accountability. </li></ul>Policy coordination and coherence <ul><li>Support the supply of trained workers who are adjustable dynamically to the changing demands of employment and technologies. </li></ul><ul><li>Promote excellence and will meet the requirements of knowledge economy. </li></ul><ul><li>Support employment generation, economic growth and social development processes </li></ul><ul><li>A framework for better coordination among various Ministries, States, industry and other stakeholders will be established. </li></ul><ul><li>Harness inclusivity and reduce divisions such as </li></ul><ul><ul><li>male/female; rural/urban </li></ul></ul><ul><ul><li>organized/unorganized employment </li></ul></ul><ul><ul><li>traditional/contemporary workplace </li></ul></ul>Choice, competition and accountability High inclusivity Dynamic and demand-based system planning India needs to create 500 million skilled workers by 2022 Enhanced Role of private sector critical to success
    4. 4. The current landscape needs drastic capacity addition to meet future demand Privately owned ITCs *Includes ministry of housing and urban poverty alleviation, textile, health and family welfare, food processing industries, and others **Assuming that the existing workforce in the age group of 45-59 will not be re-skilled ***Assuming training fee of Rs 2000 per student for the total demand estimated Source: 11 th five year plan; NCEUS report; McKinsey analysis Current capacity in skill development under various schemes, 2008-09 Eight-fold increase in capacity is required to meet aspiration Total capacity in skill development 4.3+ Other private training providers XX Other ministries* 0.3 MSME 0.2 Ministry of rural development 0.2 Ministry of agriculture 0.2 Ministry of women & child development 0.2 MHRD MLE 1.3 0.5 Total demand by 2022 526 Reduction due to ageing/ retirement** 80 Reskilling / upskilling of 90% of existing workforce (460 million) 414 Addition to workforce @ 12.8 million per year 192 Total supply by 2022 @ current capacity 65+ 8x
    5. 5. Skill development has received a major policy thrust <ul><ul><li>Revamping ITIs </li></ul></ul><ul><ul><ul><li>Conversion of 500 ITIs into centre of excellence (with assistance from World Bank) </li></ul></ul></ul><ul><ul><ul><li>Upgradation of remaining 1396 ITIs through PPP mode </li></ul></ul></ul><ul><ul><li>Upgradation of 400 government polytechnics </li></ul></ul><ul><ul><li>Computerization and networking of all 969 Employment Exchanges Centers, charging them with broader mandate of providing vocational guidance and creation of national web portal </li></ul></ul><ul><ul><li>Addition of 1500 new ITIs in PPP mode in underserved regions and industrial clusters/SEZ </li></ul></ul><ul><ul><li>Addition of 125 new polytechnics in PPP mode in hitherto underserved districts </li></ul></ul><ul><ul><li>Establishment of 50,000 Skill Development Centres to reach the rural populations </li></ul></ul><ul><ul><li>Expansion of vocational education from 9,500 senior secondary schools to 20,000 schools, increasing capacity 1.0 million to 2.5 million </li></ul></ul><ul><ul><li>Skill Development Initiative of DGET to target the informal sector by introducing demand driven short term training courses based on Modular Employable Skills (MES) </li></ul></ul><ul><ul><ul><li>Reimbursement of Rs. 15 per hour per trainee to training providers, total budget of 550 crore for skilling 1 million people </li></ul></ul></ul><ul><ul><li>Following institutional arrangements have been made </li></ul></ul><ul><ul><ul><li>National Council on Skill Development (NCSD): apex body to give policy directions </li></ul></ul></ul><ul><ul><ul><li>National Skill Development Coordination Board (NSCB): to harmonize government initiatives </li></ul></ul></ul><ul><ul><ul><li>National Skill Development Corporation (NSDC): to foster private sector participation </li></ul></ul></ul>ILLUSTRATIVE SOURCE: McKinsey study, National Policy on Skill Development Strengthen existing infrastructure Capacity addiction Fund the unviable segments Skill Development Mission
    6. 6. NSDC created as a part of the government’s co-ordinated action in the skills space Prime Minister’s National Council for Skill Development National Skill Development Co-ordination Board Government Initiatives 17 Central Ministries Private sector initiatives NSDC structure <ul><li>NSDC is a Public Private Partnership created by the Ministry of Finance </li></ul><ul><li>51% stake by industry </li></ul><ul><li>49% stake by GOI </li></ul><ul><li>Initial funding of ~ INR 1000 cr received from the GOI and parked with the NSDF for use of NSDC; additionally Rs 500Cr committed in budget for 2011-12 </li></ul><ul><li>Target skilling / up skilling 150 million people by 2022 by fostering private sector participation </li></ul>Advisor to PM on skills
    7. 7. Estimated skill gap of 240Mn across 21 key sectors Source: IMacs Study
    8. 8. NSDC in a PPP mode has funded a diverse portfolio of 33 companies; in addition 6 Sector Skills Councils Training providers In the education business In unrelated businesses Start ups Large established corporates Technable GOLS
    9. 9. Funding proposals approved by NSDC Board As of 25 August 2011 <ul><li>Number of proposals approved Training organisations Sector skills councils </li></ul><ul><li> </li></ul><ul><li>Financial commitment </li></ul><ul><li>Per annum training capacity created at full scale </li></ul><ul><li>Number of people to be trained over 10 years through 33 projects </li></ul>39 33 6 Rs 1022 Cr 113 Lakhs 570 Lakhs
    10. 10. Current status of SSC proposals 30 SSCs at various stages of Formation
    11. 11. Snapshot of 10 year NSDC Targets : The Skill 500 * These are achieved after a lag of a year   FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Total Total Proposals per year to be Funded (nos.) 25 32 44 52 60 65 62 50 42 31 23 14 500 Small ticket proposal 6 11 16 21 24 25 22 18 15 11 9 6 184 Medium ticket proposal 16 18 24 27 32 35 34 28 24 18 12 7 275 Big ticket proposal 3 3 4 4 4 5 6 4 3 2 2 1 41 Total Trainee Output per year (nos. lakh)* 1.2 6.1 15.7 33.4 60.2 97.9 146.1 203.9 266.4 331.8 395.1 454.2 2011.9
    12. 12. In addition knowledge base being created <ul><li>Sector skills gap reports met with huge acceptance from multiple stakeholders </li></ul><ul><li>Studies initiated for skills gap in the Infrastructure sector </li></ul><ul><li>Pilot for district wise skill gaps being initiated with IAMR </li></ul><ul><li>State skill gap study being initiated for Orissa and NE </li></ul><ul><li>Study on Train the Trainer being initiated with MART </li></ul><ul><li>Study on Financing Mechanisms for Vocational Loans being done with ISB </li></ul>
    13. 13. Attempts to create an “enabling” environment - skill loan being introduced with Central Bank of India
    14. 14. Current Status of SSCs by Industry Sectors 32 SSCs at various stages of Formation 6 7 11 8
    15. 15. Agenda The way forward
    16. 16. The skills industry however facing challenges in the environment in which it operates Reward for trained manpower Compensation for trained resources Awareness Brand for vocational training – social stigma Quality and growth prospects Non availability of good quality trainers Salary structures Ability to pay Willingness to pay Conversion from push to pull model Industry interface Making vocational skills aspirational Quality and availability of trainers Student Mobilization KEY CHALLENGES POLICY POLICY
    17. 17. Challenge 1 : Policy Is there an overlap in roles? <ul><li>Vocational Schools </li></ul><ul><li>PPP programmes </li></ul><ul><li>CBSE, AICTE affiliation </li></ul><ul><ul><li>Developing NVEQF </li></ul></ul>HRD Ministry Setting standards Accreditation Running institutes Funding Employment utilities <ul><ul><li>Upgrade Employment Exchanges*, integrating them into a LMIS </li></ul></ul>Ministry of Labour <ul><ul><li>Mandate to develop NVQF given to NCVT </li></ul></ul><ul><ul><li>Set up framework for affiliation and accreditation of institutions </li></ul></ul><ul><ul><li>Frame policy decision on ITIs/ITCs </li></ul></ul><ul><ul><li>Skill development initiative to fund courses in modular employable skills (MES) </li></ul></ul>State governments <ul><ul><li>Operation of ITIs and various schemes </li></ul></ul><ul><ul><li>Support training providers by sha-ring infrastructure </li></ul></ul>Other central ministries <ul><ul><li>Each ministry having training programs for its own sector** </li></ul></ul><ul><ul><li>Various sector specific initiatives by ministries*** </li></ul></ul><ul><ul><li>Set up SSCs to develop standards and skills inventory </li></ul></ul><ul><ul><li>Establish sector-specific LMIS at national & state level </li></ul></ul>NSDC / SSCs <ul><ul><li>Standardize affiliation and accreditation process through SSCs </li></ul></ul><ul><ul><li>Fund proposals with viability gaps </li></ul></ul>Govt./semi-govt. entities Various aspects of skill development
    18. 18. Challenge 1 : Policy Is there a common direction and approach on skill building? <ul><li>Grant models vs sustainability </li></ul><ul><li>Industry recognition vs government certification </li></ul><ul><li>Short term vs long term vision and plans </li></ul><ul><li>Integration with UIDAI </li></ul>
    19. 19. Challenge 2 : Making VT aspirational / Student Mobilization Learnings from NSDC partners meet Key challenges Best Practice/ solution to deal with the challenges <ul><li>Skills means “Blue Collar” – low aspirations </li></ul><ul><li>Convert from “push” to “pull” </li></ul><ul><li>Demand supply mismatch </li></ul><ul><li>Cost of mobilization </li></ul><ul><li>Commensurate compensation </li></ul><ul><li>Demand led approach </li></ul><ul><li>Use of local opinion leaders and influencers </li></ul><ul><li>Spend time on counseling – it is time well spent </li></ul><ul><li>Skill mapping and profiling </li></ul><ul><li>Availability of finance </li></ul><ul><li>Campaign to make VT aspirational </li></ul>
    20. 20. Making skills aspirational – integral to developing the eco system World Skills competition 1 National campaign to make skills aspirational 2 Business Plan competition focused on skill development 3
    21. 21. Challenge 3: Industry Interface Learnings from NSDC partners meet Key challenges Best Practice/ solution to deal with the challenges <ul><li>Quality placement, underemployment </li></ul><ul><li>Industry not getting what it needs </li></ul><ul><li>Industry not willing to pay higher salaries for trained resources </li></ul><ul><li>Sector Skills Councils </li></ul><ul><li>Involve industry through training life cycle </li></ul><ul><li>Soft skills an integral part of training program </li></ul><ul><li>Internship models </li></ul>
    22. 22. Challenge 4 : Availability of Trainers Learnings from NSDC partners meet Key challenges Best Practice/ solution to deal with the challenges <ul><li>Compensation structure </li></ul><ul><li>Skilling for trainers </li></ul><ul><li>Variation in quality </li></ul><ul><li>Availability in rural / semi urban areas </li></ul><ul><li>Incentive and referral schemes </li></ul><ul><li>Link performance to placements </li></ul><ul><li>Define career path </li></ul><ul><li>Technology interventions </li></ul><ul><li>Involve industry </li></ul>
    23. 23. Onus now on industry on multiple fronts Extract from National Skills Policy <ul><li>Owning Skill Development activities </li></ul><ul><li>Identification of competencies and setting up of competency standards, skill demand analysis and curriculum development </li></ul><ul><li>Facilitating training of trainers </li></ul><ul><li>Delivery of training, monitoring and evaluation </li></ul><ul><li>Participation in examination and certification </li></ul><ul><li>Participation in affiliation and accreditation process </li></ul><ul><li>Sharing of work place experience, machinery and equipment </li></ul><ul><li>Support by way of physical, financial and human resources </li></ul><ul><li>Facilitating employment of trained graduates </li></ul>
    24. 24. Thank you [email_address]