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[op-ed snap] A global opportunity for the Indian workforce

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Mains Paper 3: Economy | Development & employment

From UPSC perspective, the following things are important:

Prelims level: Global Economic Prospects report, Gini coefficient, Annual State of Education Report, World Development Report

Mains level: Ways to improve skill development and employment


Global Economic Prospects report

  1. The World Bank’s latest “Global Economic Prospects” report shows that the second wave of change in the global labour market will play out over the next two decades
  2. Developing economies will be contributing to all of the addition in the global skilled labour force
  3. This is because the number of skilled workers in advanced economies is expected to decline

Global workforce and skilled workers

  1. Skilled workers have been defined as those having at least nine years of education
  2. The global skilled workforce is likely to increase from 1.66 billion workers in 2011 to 2.16 billion by 2040

What will this lead to?

  1. Improvement in the level of education and skill tends to increase income
  2. Rising income in the developing world will lead to a reduction in inequality
  3. The global Gini coefficient is estimated to decline from 65.8 in 2012 to 62.6 by 2030

Gains depend on adjustments

  1. India has benefited by integrating with the global economy
  2. The next wave of gains will depend on how well it adjusts to the changing economic and technological environment
  3. Policymakers will need to work on different levels to be able to create a competitive labour force

What needs to be done?

  1. First, India urgently needs to focus on education and skill development
  • The “Annual State of Education Report” periodically shows the depressing state of education in Indian schools
  • The World Bank also highlighted the problem in its “World Development Report” last year
  • Outcomes in education could be improved by better use of technology

2. Second, the World Bank in its analysis assumes that additional workers will get employed

  • India has not been able to create enough employment opportunities for people moving out of agriculture
  • The basic reason for this is India has not capitalized on labour-intensive manufacturing
  • Recent research shows that India’s competitive advantage in some of the labour-intensive sectors has actually declined in recent years
  • The legal and regulatory requirements in markets like land and labour make it difficult for firms to grow and take advantage of economies of scale
  • To be able to absorb its rising workforce, India needs to remove impediments in the manufacturing sector

3. Third, inequality has gone up in advanced economies

  • Even though inequality at the global level declined in recent decades, it has gone up in advanced economies as the national income share of wages came down
  • Therefore, the lingering risk of protectionism is unlikely to dissipate in a hurry
  • India will need to protect its interest in such an environment and look for opportunities to increase trade at both bilateral and multilateral forums
  • Adequate attention should be paid to currency management in the world of volatile capital flows
  • It will be difficult to grow at a faster pace without the backing of strong exports as exports are an important driver of growth and job creation

Way Forward

  1. An increasing number of skilled workers not only raises the potential growth but also reduces inequality within the country by reducing the skill premium
  2. A skilled labour force along with a focus on manufacturing and exports will help India grow at a faster rate in the medium to long run


Gini Coefficient

  1. Gini Coefficient is a popular statistical measure to gauge the rich-poor income or wealth divide
  2. It measures inequality of a distribution — be it of income or wealth — within nations or States
  3. Its value varies anywhere from zero to 1
  4. Zero indicates perfect equality and one indicates the perfect inequality
  5. Gini Coefficients can be used to compare income distribution of a country over time as well
  6. A general rise in Gini Coefficient indicates that government policies are not inclusive and may be benefiting the rich as much as (or even more than) the poor

Government to enable skilled persons bag jobs abroad 


Mains Paper 3 : Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources.
Prelims level: Policy for skill India
Mains level: Steps being taken by Government for skilling people.
2016 Mains question: “Demographic Dividend in India will remain only theoretical unless our manpower becomes more educated, aware, skilled and creative.” What measures have been taken by the government to enhance the capacity of our population to be more productive and employable?


  1. India plans to make it easier for masons, carpenters and plumbers, among other skilled persons, to get jobs overseas.
  2. The skill development and entrepreneurship ministry is giving a final shape to the policy, which will be presented to the Union cabinet for its approval.
  1. The policy and the action plan will address the information asymmetry.
  2. Information Asymmetry exists across the globe for different skills and the basic minimum certification required for each skill in different countries.
  3. Currently, the skill development ministry does not have enough information on how many masons or plumbers are needed and in which countries.
  4. The new policy will help us map this requirement,
  1. India will have a surplus manpower of four-five crore over the next decade.
  2. Vision to make India the skilled capital of the world.
  3. Part of the larger vision to imparting skills to 50 crore youth by 2022.
Earlier Steps Taken
  1. Last year, government announced the launch of 50 India International Skill Centres to impart training to youth under the Pravasi Kaushal Vikas Yojana.
  2. The idea was to increase the employability and acceptability of Indian youth on global platforms.

Pradhan Mantri Kaushal Vikas Yojana

  1. News: The Cabinet cleared a Rs 12,000-crore revamped version of the Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
  2. Aim: To impart skills to over 1 crore people in the next 4 years – includes training to 60 lakh youths and certifying 40 lakh informally skilled workers
  3. Includes a mechanism to revive the traditional Guru-Shishya approach to train youth with the help of local craftsmen and trade practitioners
  4. Training centres will be categorised on the basis of their infrastructure and past performance and third party agencies will be deployed to validate their training efforts and placement records
  5. Members of Parliament will also be roped in to mobilise youth for training, monitor the scheme in their constituencies and post-training placement of trainees

Google to train 2 mn developers in Android

  1. News: Google launched a program to train 2 million developers in India on Android, its mobile operating system, in the next 3-year period
  2. Aim: Enabling the developers to make innovative mobile applications on the platform and to make India the global leader in mobile app development
  3. Low rank: Google’s Play Store has over 1 million applications, and less than 4% of the top 1000 applications come from India
  4. Trivia: India is expected to have the largest developer population of 4 million by 2018, overtaking the US

Scheme for apprenticeship training

  1. News: The Centre approved an outlay of Rs 10,000 crore towards National Apprenticeship Promotion Scheme
  2. Aim: To provide apprenticeship training to 50 lakh youth by 2020
  3. The scheme will provide financial incentives to employers to engage apprentices
  4. The Ministry of Skill Development and Entrepreneurship will share 25% of the total stipend payable to an apprentice with employers
  5. The government will also fund 50% of the total expenditure incurred by the employer in providing basis training to apprentices

Skill banks to help India become the HR capital

  1. News: The plan to make India ‘the human resource capital’ of the world will first take off in Uttar Pradesh and Bihar, with setting up of skill banks
  2. The Ministry of Skill Development and Entrepreneurship and the External Affairs Ministry will be co-operating on the vision
  3. Skill banks: To train potential immigrant workers in various job roles as per international standards
  4. Will impart skills across sectors where job opportunities exist or are likely to arise across different countries
  5. Before they emigrate, youth in skill banks would be made familiar with the respective local culture and language of the country they obtain a job

Let’s know about the National Skill Development Mission (NSDM)?

  1. The Mission aims to provide a strong institutional framework at the Centre and States for implementation of skilling activities in the country.
  2. The Mission will have a three-tiered, high powered decision making structure.
  3. At its apex, the Mission’s Governing Council, chaired by the Prime Minister, will provide overall guidance and policy direction.
  4. The Steering Committee, chaired by Minister in Charge of Skill Development, will review the Mission’s activities in line with the direction set by the Governing Council.
  5. The National Skill Development Agency (NSDA), the National Skill Development Corporation (NSDC) and the Directorate of Training will function under the overall guidance of the Mission.

Each district to have at least one skill development centre by 2017

Industry pledges commitment to the National Skill Development Mission.

  1. As part of the Skill India Development Mission, the union Ministry of Skill Development & Entrepreneurship has embarked upon a special industry initiative.
  2. To attract leading corporate to set up co-branded Corporate Skill Excellence Centres in PPP mode.
  3. The Government will provide various tax and non-tax incentives for corporates that set up Corporate Skill Excellence Centres as part of their core business or CSR activities.
  4. The CSR funds can be routed through National Skill Development Fund with specific outcomes.

Centre to map country’s training infrastructure

  1. The govt is mapping the country’s existing training infrastructure, including thousands of private training institutes.
  2. The capacity created by private investment do not reflect in the official data, though they are doing well.
  3. As part of Skill India Mission NSSO will collect details about training institutions, their capacities for imparting different skill sets and their utilisation by young job market aspirants.
  4. This will help in assessing the shortfall in capacity and a plan for bridging the gap can be formulated and implemented.

Singapore eyeing Skill India collaboration during Narendra Modi visit

  1. Singapore plans to hard sell the ITE concept of vocational training, aligning it with Modi’s pet Skill India.
  2. This will resolve one of the paradoxes of India is that it has an educated population but not a skilled one.
  3. The other agenda will be promoting urban planning concepts, enhancing trade and investment, improving connectivity and increasing engagement with the states.

Uphill task for Skill India mission

The National Sample Survey Office has released data from its 2011-12 round on education and vocational training.

  1. The NSSO data showed that only 2.4% people had technical degrees, diplomas or certificates in fields like medicine, engineering or agriculture.
  2. Nearly 90% of employable people did not receive any vocational training, which poses a challenge to govt.’s Skill India mission.
  3. More than 70% males cited that supplementing household income was the main reason for not being enrolled in any educational institution.
  4. Domestic chores prevented more than half of the females from studies.

National Skill Development Mission & its 3 parts

  1. The National Skill Development Mission, an umbrella body, has 3 institutions under it.
  2. National Council on Skill Development (Chairman = PM) – To give policy direction and review skill development efforts.
  3. National Skill Development Coordination Board (Chairman = Vice Chairman NITI Aayog) – To enumerate strategies to implement the decisions of PM’s council.
  4. National Skill Development Corporation (NSDC) – A non-profit company – to meet the skill training requirements of the labour market including the unorganised sector.

PMKVY – Pradhan Mantri Kaushal Vikas Yojana (2/2)

  1. How will the govt. ensure quality? – Skill Development Management System + Grievance redressal system + Biometric system and Video recording.
  2. Further,an online citizen portal will be put in place to disseminate information about the program.
  3. Mobilisation of youth to be done through Skill Melas at the local level.
  4. The efforts in this direction, are being carried on a mission mode.
  5. The National Skill Development Mission, an umbrella body, has 3 institutions under it.

PMKVY – Pradhan Mantri Kaushal Vikas Yojana (1/2)

  1. Implementation Agency – Ministry of Skill Development & Entrepreneurship through the National Skill Development Corporation (NSDC) + training partners.
  2. Primary Focus – First time entrants to the labour market (mainly dropouts from Class 10 & 12). Will be a paid training regime.
  3. Workforce will cater to – Flagship programs like Make in India, Digital India, National Solar Mission and Swach Bharat Abhiyan.
  4. A Demand aggregator platform is also being launched.

What’s wrong with Skill India and how to fix it?

  1. While outlays on skill development have been increasing, outcomes lag far behind.
  2. Most skill dev. programs offer a crash course module training to rural migrants which lasts 2-3 months. Industry has no stake in this process.
  3. Employers see very little value-addition in such training, and essentially view training companies as manpower sourcing agencies.
  4. In Germany – employers fund the bulk of the programme’s cost through a paid apprenticeship-based model.

:( We are working on most probable questions. Do check back this section.

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