The focus of this year's budget should be on increasing the pace of operationalizing the skill development eco-system by ensuring that the end objectives of (i) industry receiving the skill sets they desire and (ii) trainees achieve their aspiration for an improved quality of life are achieved.
There is an urgent need to bridge the demand and supply gap for employable resources. The current situation of supply of skilled resources which is not aligned to skill sets demanded by industry needs to be addressed by greater involvement of industries in skill development curriculum setting, upgrading tool rooms & lab facilities at vocational training centres, investments in teachers training to improve quality of training, etc. through the respective sector skill councils or their corporate social responsibility (CSR) initiatives.
With CSR mandated for companies meeting prescribed financial thresholds in the Companies Act, 2013, it has been observed that "promotion of education including employment enhancing vocation skills" has been the preferred CSR activity for most companies.
In designing their CSR strategies and initiatives, industry should look at long term involvement in skill development in their business interests and not just fund short term training courses with the sole intention of complying with the law.
Government should consider treating CSR expenditure in same manner as business expenses for income tax computation, as tax deduction are only allowed where the concerned training provider is registered with the Income Tax department under section 80G. This deters many companies from engaging with capable vocational training service providers who are not registered under section 80G.
Best practices from the world renowned German apprenticeship model, localized to suit Indian ground realities, should be examined for adoption where industry and training institutions are equal stakeholders in the system of providing on the job training (as opposed to short duration practical training as part of a course) for the goal of a productive workforce benefitting the industry. Government should consider extending the benefits of Apprentice Protsahan Yojana,where 50 per cent of prescribed stipend is reimbursed by the Government, to industries which fulfils the requisite criteria in adopting a similar model of partnering with vocational training institutes on a long term basis for offering apprenticeships.
Another successful model of skill development in other parts of the world has been the community colleges, where local industries collaborate with education institutions for designing and providing vocational training courses with award of certificates/ diplomas/ degrees based on credits. While Tamil Nadu has seen success in establishing such community colleges by NGOs, the concept is yet to catch up in other parts of the country. Budgetary support should be provided to the Ministry of Skill Development and Entrepreneurship to establish model community colleges in select regions of the country preferably in PPP mode.
Government should also make adequate budgetary provisions for a targeted awareness campaign aimed at changing society's mindset for preferring higher education degrees over a recognized skill certificate.
Once industry participates in the nation's skill building agenda and formalizes employing certified skilled resources trained as per their requirement at compensations higher than uncertified resources, society's perceptions on vocational training as a career option will change, leading to higher number of youth opting for a skill based career to meet their aspirations for an improved quality of life. This will also go a long way towards the National Skill Development Mission goal of making India the talent capital of the world.
(Anindya Mallick is a Partner with Deloitte in India. )