Earlier this year, the interim budget presented by the Finance Minister highlighted significant strides in India’s educational infrastructure. This included the addition of 3,000 ITIs, 7 IITs, 16 IITs, 7 IIMs, 15 AIIMS, and 390 universities to make education accessible in Tier 2 and 3 cities.
Additionally, 1.4 crore individuals were skilled, and 54 lakh youth reskilled under the Skill India mission, underscoring a robust learning ecosystem. However, to truly unlock economic productivity, India must enhance its employability infrastructure beyond the physical realm.
India is well-positioned to leverage the “China Plus One” strategy in the global supply chain, showing some early signs of success. However, establishing itself as a recognised global manufacturing hub will take a few more years. This requires bilateral trade pacts, easier business processes, and a skilled workforce to meet potential demand. The increasing investments in sectors like electronics, auto, renewable energy, telecom, and engineering, coupled with the adoption of technology and AI, have widened the skill gap that must be addressed to balance volume with quality. Today, 4.3 crore people are enrolled in higher education, with a Gross Enrolment Ratio (GER) of 27 per cent—up from 17 per cent a decade ago. Despite this, employability remains a concern, with rates hovering around 47 per cent for technical graduates and 22 per cent for non-technical graduates.
The informality in the skilling system impacts productivity. Only 7 per cent of the workforce undergoes structured training, compared to 84 per cent in China, 75 per cent in Germany, and about 70 per cent in the US and Australia. To bridge this gap, India needs to boost both the capacity and capability of its employability infrastructure through digital infrastructure, policy overhauling, and innovative financing.
India must develop and enhance digital learning infrastructure to bridge the socio-economic divide and ensure equitable quality education at all levels. Although COVID-19 accelerated the adoption of digitization in education, it also led to learning losses due to a lack of digital infrastructure. The ASER report highlights gaps in primary and secondary education.
The post-pandemic era has corrected the course of adoption to suit different categories of learners, from school-goers to higher education and employed learners for upskilling and reskilling. The launch of the Digital University aims to address these gaps. With deeper internet penetration (900 million active internet users, 50 per cent from rural areas) and 659 million smartphone users, and the introduction of 5G services, there is immense potential for growth and upgrading digital learning infrastructure, especially in rural schools and colleges.
The 2015 Skill Policy needs overhauling to address the impact of AI and support the “Make in India” mission. Key areas for revamping include: 1. Amending the Apprentices Act: Incorporating academia as a third party and implementing a tripartite agreement for seamless execution of Degree Apprenticeships under the New Education Policy. This will improve the GER and balance it with the youth employability quotient. 2. Increasing the Apprentice Quota: Facilitating a skilled workforce for potential opportunities under the “Make in India” mission. 3 Provisioning of reskilling professionals through Adult Apprenticeships. 4. Improving Women’s Participation: Making special provisions for female apprentices under NAPS, focusing on rural women’s participation. 5. Separate Guidelines for Skills Universities: Allowing them to offer work-integrated education programs in a blended format in collaboration with the industry.
The current expenditure on education is 4.6 per cent of GDP, slightly above the global average of 4.3%, despite the recommendation of 6 in various education policies. To meet financial requirements, innovative skill and education financing methods are needed: 1. Degree Apprenticeship: Facilitating industry-academia collaboration and scaling adoption through policy interventions. 2. Social and Education Bonds: Introducing a skill and education levy to foster a resilient and adaptable workforce.
India stands at a demographic inflexion point, with 65 per cent of the population in the employable age bracket and 40 per cent below 25 years of age. However, the young population is expected to decline in the next 15 years. With 5 million youth graduating annually and 12 million entering the labour force, upgrading employability infrastructure is crucial for unlocking economic productivity. Last year, Rs 7,000 crore went unutilised from the allocated Rs 1.16 lakh crore. While higher education budgets may be demanded, it’s essential to ensure judicious utilisation to provide equitable opportunities for quality education and bridge the gap between education and employment, setting the trajectory for a USD 35 trillion economy by 2047.
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