The Parliamentary Standing Committee on Labour, Textiles and Skill Development recently submitted its 36th report on the implementation of the Pradhan Mantri Kaushal Vikas Yojana (PMKVY).
It may be recalled that the PMKVY seeks to promote skill development by providing free training programmes and monetary rewards for obtaining skill certification. The aim of the programme is to remove the "disconnect between demand and supply of skilled manpower, building a vocational and technical framework, skill upgradation, building new skills and innovative thinking". A vision of a 'skilled India' is what is sought to be achieved.
India is a country with about 65 per cent of its youth in the working age group. The only way we can possibly reap the demographic advantage is through skill development. As the standing committee report states, "It is acknowledged that skill and knowledge are the driving forces of economic development. With one of the youngest population levels, India can realise its demographic dividend through a workforce that is trained in employable skills and is industry-ready."
The Ministry of Skill Development & Entrepreneurship (MSDE) has spearheaded PMKVY to drive the skilling programme across the country through the Pradhan Mantri Kaushal Kendras (PMKK), state-of-the-art training centres. The PMKVY scheme was launched in 2015 to encourage and promote skill development with an initial outlay of Rs 12,000 crore. The scheme was grant-based, providing free-of-cost training and skill certification in more than 1,800 job roles to increase the employability of youth. It was to be implemented through Centrally Sponsored Centrally Managed (CSCM) and Centrally Sponsored State Managed (CSSM) components.
It is against this backdrop that the report makes significant reading. Currently, PMKVY 3.0 launched in January 2021 is in operation. The report highlights the fact that despite revisions in the scheme, the problems of the earlier versions persist. The report specifically highlights the underutilisation of funds. In the 3.0 version, only 72 per cent of the funds have been utilised. Thus, there has been low distribution and underutilisation of funds.
The report has rightly pointed out that the success of the skilling programme depends entirely on the placement of skilled personnel. Under PMKVY 2.0, out of the 91.4 lakh candidates who were said to have been trained, only 21.3 lakh were placed. The ongoing version has an even poorer record — out of the 4 lakh trained, only 30,599 (8 per cent) have been placed.
Obviously, either the training has made little difference to the skillset of the candidates or the skilling given is not in areas — in either case, it defeats the purpose of the scheme. The ministry, however, has in its report on impact assessment stated that there has been a 15 per cent increase in the mean monthly income of the trained candidates.
The committee has not been too impressed with the ministry’s assessment. It observed that "the very purpose of imparting training and certifying the candidates is defeated when placement statistics is abysmally low". The need for the training programme to be aligned with industry needs cannot be over emphasised.
Similarly, the report observes that gross underutilisation of funds undermines the intent of the scheme. It goes on to add, "Needless to say, the ministry ought to pay serious attention towards addressing the impediments so as to leverage the placement/self-employment of the trained/certified candidates to a sizeable extent as well as to maximise utilisation of earmarked funds."
The committee has also commented on the high percentage of dropouts — nearly 20 per cent have dropped out after starting the training. The reasons ranged from the distance of the training centres from residential areas to the lack of accessibility to jobs.
The report is significant in the context of the growing unemployment in India. As on Nov 22, as per CMIE, the unemployment rate was 7.72 per cent — up from the September rate of 6.43 per cent. (Unemployment rate is the percentage of people in the labour force who are unemployed, people who are willing to work but do not have a job). The unemployment rate was said to be 8.5 per cent in urban areas and 7.34 per cent in rural areas.
The prime minister had in October announced a drive to fill up 10 lakh jobs. Appointment letters have been given to nearly 1,46,000 newly inducted appointees in two rozgar melas; the second mela was held on November 22.
The PM highlighted the importance of skilling India's youth for a brighter future. "Today, we are emphasising the skill development of youth. Under the PMKVY, a huge campaign is going on to train the youth according to the needs of the industries." The PM informed that 1.25 crore young people have been trained under the Skill India Abhiyan.
The parliamentary committee’s report would suggest that the work to translate training into employable jobs is still some distance away.
(The writer is chairman (retired), Central Board of Indirect Taxes & Customs)