Youth + Expertise = Viksit Bharat: India's Skill Imperative

- Akshay Fadnis

India has been on the precipice of greatness with its demographic dividend advantage for a decade now. The government has been doing a lot to increase the nation's productivity via its initiatives to build human capital. A new IIT and IIM has been inaugurated every year for the past 10 years, every week a new university is being built, and 1.4 crore youth have been trained by the Skill India mission. However, India is still seeing record youth unemployment figures. While a lot of effort is being put into bringing manufacturing jobs to India, most high-value jobs still elude her due to brain drain.

The Glamour of the IITs and IIMs

It is no secret that in India, most college-eligible students aspire to join IIT/IIM or in some cases both. These are the premier institutes for higher education in India, promising both state-of-the-art education and assurance of high-paying jobs. Until recently, the IIMs boasted a 100% placement rate with the highest package record being broken year on year. The IITs themselves have the cream of the crop in terms of the most talented and smartest youth in the country. The placements always present a rosy picture for aspirants with IIT Bombay having the highest offered CTC of INR3.6 crore per annum and a median package of INR22 lakhs per annum in the 2023-24 placement season. However, paradoxically, the country is witnessing an exodus of such highly valued human capital. In 2022, 36% of the top 1000 Ranks and 62% of the top 100 ranks have moved out of India. On the other hand, the pull of these institutions is so great that not being able to clear IIT-JEE, or even the mere thought of inability to do so, has led students 21 students in 2023 to commit suicide.

The Institutes of Eminence

In 2016, there were no Indian universities in the World University Ranking list. The government then decided to create high-quality education and research institutions which would be known as the Institutes of Eminence (IOE). They would all be multi-disciplinary with a focus on teaching as well as research, well equipped with state-of-the-art research equipment, which would receive priority funding. Along with this, all bureaucratic hurdles were proposed to be removed to hire foreign faculty and admit foreign students. The government’s initial plan was to create 10 public and 10 private autonomous IOEs selected by an empowered committee, to be globally competitive and feature in any of the world university rankings. The situation now, however, is disappointing with only INR3000 crore out of the promised INR5000 crore released to 8 IOEs to start their reforms and 2 others still waiting. The term of the empowered committee has lapsed in 2021 and has not yet been renewed. Four private institutions that were cleared by the committee are still waiting for the IOE tags. The private colleges that did receive the IOE tags are now facing the same bureaucratic red tape contrary to what they were promised. All the IOEs that were supposed to be autonomous also face the University Grants Commission's endless regulatory demands. 

The ITIs

It is essential to skill, reskill, and upskill people as India looks towards becoming a major manufacturing hub. The ITIs have been the go-to place to get vocational education and training in India since the 1950s. Skilled people are needed for intermediate services such as carpentry, plumbing, construction, etc., as well as to provide services to the manufacturing hub workers. Overall, there are 14,789 ITIs including private and public, with an overall capacity to train more than 25 lakh trainees. The vision was to make the ITIs, the human capital backbone of India's manufacturing. However, the current situation of the ITIs is pretty dire. The National Council of Vocational Training (NCVT) grades ITI on a scale of 1 to 5 with 5 being the best. The average rating of Indian ITIs is a measly 1.4. Only 8% of the ITIs in total were rated above average, i.e., sufficient to receive the funding from a World Bank initiative called "Skill Strengthening for Industrial Value Enhancement Scheme" (STRIVE). There is a severe faculty shortage as well, with only 36% of the overall faculty positions filled. On top of this, most of the available faculty themselves have not yet upskilled to the industry standards. Once the students have finished their certifications it is very hard for them to find employment with an average placement rate of just 0.1%. The trainees who have completed graduation themselves can't meet the industry standards for being employed because of below-par faculty. The only way forward for them is to be self-employed or rejoin the ITI but this time as an instructor.

Incentivising Ghar Vapsi

India needs to step up and make it easier to train and utilise the vast human capital in services it has in both high-value and embedded services, and manufacturing. This can be achieved with proper focus on improving the standards of curricula to the level needed not just by industry today but also to be ‘future ready’ with regards to the technology of tomorrow like AI. The government cannot bear the full responsibility of creating jobs directly but it can make it easier for the private enterprising citizens with a lot of creative ideas to set up businesses and provide employment. It can also change policy in terms of labour laws, trade tariffs, regulatory easing about the granting of permissions, and faster processing of applications. There is already a subsidy to the tune of USD2.75 billion being offered to a large chip manufacturing firm to establish a plant in Gujarat. As per the book "Breaking the Mould" by Rajan and Lamba, this subsidy is slated to cost the government INR 3.2 cr (USD400,000) per job created at the plant with about 5000 jobs to be created. India needs to be in a position to be able to create jobs both in the public and private sectors at all skill levels. The medium to lower-skilled people need to find employment assistance. When more people are getting employed, it will encourage the youth to join ITIs to upskill themselves. This demand will hopefully force them to provide better quality training leading to a virtuous cycle. The ITI certification needs to be valued higher, the government can set an example on this front by contracting jobs to people with such certifications. This will be a signal to the private market that the workers have the necessary skills. 

Apart from this, the Indian government has to try and attract many highly skilled, high-value scientists, engineers, and managers of successful firms from abroad, especially attracting talent from among the country’s international diaspora. There exist programs like Visiting Advanced Joint and Research Facility (VAJRA) which aim to collaborate with International faculty and scientists including NRIs and Persons of Indian Origin by offering them adjunct positions in our public universities. In addition, there are fellowship programs like the Ramanujan fellowship, Ramalingswamy re-entry fellowship, and Distinguished and Outstanding Scientists Scheme for the Scientists and Technologists of Indian Origin (STIOS) for the short-term return of people with similar professional backgrounds. 

The main incentive, as indicated by an article by Li, Wei & Bakshi, for the international diaspora to return is a financial one. While these programs offer what seems like attractive pay by Indian standards, they don't match the remuneration they receive abroad. Public universities thus need to step up and attract talent from across the globe by offering attractive incentives. Also, the bureaucratic hoops that these talents have to jump through to get their paperwork processed make these positions less attractive.

Conclusion

Skilling in India is now more necessary than ever. With a large demographic dividend at our disposal, we have a unique opportunity to leverage the energy, curiosity, and enthusiasm of our youth to propel our country to the next level and build a 'Viksit Bharat' (developed India). By equipping our young population with relevant skills, we can empower them to secure better jobs, contribute more significantly to the economy, and drive innovation across all sectors.

The government has a crucial role to play in facilitating skilling initiatives by creating a robust skilling ecosystem, promoting industry collaboration, and ensuring skill development programs are aligned with the evolving needs of the job market. However, building a world-class economy also requires attracting skilled talent from abroad. This includes scientists, researchers, and experienced managers who can bring fresh perspectives, cutting-edge knowledge, and proven leadership skills. Streamlining immigration processes, offering competitive salaries and benefits packages, and fostering a welcoming and inclusive environment will be key to attracting this valuable talent pool. By combining the strengths of our domestic workforce with the expertise of international professionals, including NRIs and persons of Indian origin, we can create a dynamic and innovative ecosystem that fuels India's rise as a global leader.