New Delhi: Less than 3% of Rs1,500 crore allotted in the two years to 31 March to upgrade industrial training institutes in partnership with the private sector has been utilized, India’s apex Plan panel said in a report.
As little as Rs42 crore of the Rs1,500, or 2.8%, has been utilized, a review by the Planning Commission has found.
The review has also pointed out inefficiencies such as dropouts, vacant faculty positions, limited demand in the manufacturing sector, obsolete and poor quality courses and lack of multi-skilling in these institutes.
Government data suggests 80% of new entrants in the labour market have no skills training. Only 2% of the existing workforce has some skills training against 96% in Korea, 75% in Germany and 80% in Japan.
Training capacity at ITIs and Information Technology Centres is about 30% of the total available training capacity, which caters to about 11% of the projected increase in the labour force every year, according to official data.
These figures compare poorly with the projected work opportunities of 58 million in the five years to 31 March 2012. This is in spite of India’s focus on skills development, articulated in the 2008-09 budget, which spoke of establishing a national mission to address the issue.
The government has also recently set up a National Skill Development Corporation, which aims to foster public-private partnerships to ensure that increasing numbers of people are trained in skilled jobs. It plans to train 150 million people in a decade.
There are 6,906 ITIs in India, of which around 1,500 have been upgraded to some extent with help from the private sector.
“The review suggests that public private partnership in industrial training is not working out. There have also been instances of delayed release of funds,” said a Planning Commission official, who declined to be identified.
“Besides, industry partners as also the principals of ITIs are hesitant in spending the money as there are too many conditionalities attached to the funds by the governemnt.”
Currently, these funds— Rs2.5 crore per ITI—have to be utilized over five years. Not more than 50% has to be kept as seed capital and not more than 25% has to be set aside for construction purposes.
“It is a wrong time to conclude private-public partnership is not working. Because of a downturn, demand for skilled workers has fallen dramatically,” said Amir Ullah Khan, director of research at Bangalore Management Academy.
To make ITIs more productive, the Planning Commission has suggested setting up institute management committees (IMCs) as registered societies, which will help monitor and evaluate their performances. It has also said that interest-free loans of Rs2.5 crore per ITI by the Union government should be directly disbursed to the IMCs. Besides, it has suggested that the IMCs prepare institute development plans, which will be a roadmap for future growth.
“Establishing IMCs is a good idea provided they are professionally managed with a big representation from the industry,” Khan said.
The plan panel has also proposed that IMCs take the responsibility of putting in place placement cells, making ITIs self-sustaining, oversee training and re-training of teachers and making the courses more relevant.
These include focusing on new areas such as architectural assistance, interior decoration and design, and technical assistance at power plants, among others.