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Manufacturing: No skills, no scale

21 Sep 2026
2 min

India's Manufacturing Aspiration and Skill Development

India aims to enhance its manufacturing sector to become a significant engine of economic growth, exports, and employment, while also advancing in global supply chains across sectors such as electronics, automobiles, and clean-energy equipment. This ambition is supported by initiatives like production-linked incentives, industrial corridors, and investment in logistics.

Current Challenges in Skill Development

  • India has a large labor force but a small pool of formally trained workers.
  • Formal vocational or technical training reached only 4.9% of Indians aged 15-29, with 21.2% gaining skills informally.
  • Government programs reported cumulative participations: 
    • 16.5 million in Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
    • 3.66 million in Jan Shikshan Sansthan
    • 5.3 million in National Apprenticeship Promotion Scheme
    • 10.7 million through Industrial Training Institutes (ITIs)
  • Despite these numbers, there is a discrepancy between program participation and actual skilled workers due to overlaps and non-equivalent qualifications.

Industry Needs and Challenges

  • The automotive industry finds it difficult to fill roles requiring modern skills like electronics, embedded software, and automation.
  • NCAER's study highlights shortages in CNC operators, technicians, and mechanics.

Lessons from Global Models

China's Model

  • Post-1978, China aligned its education system with industrial needs, increasing vocational students from 7.6% in 1978 to outnumber general students by 1990.
  • Between 2012 and 2021, vocational institutions produced 61 million skilled professionals.
  • Established industry connections through over 1,500 vocational-education alliances and 1,000 modern apprenticeship programs.

Taiwan and Vietnam's Approach

  • Taiwan evolved vocational education alongside industrial growth, adapting to technology demands.
  • Vietnam's strategy (2021-30) focuses on linking vocational training with business needs and market demands.

Recommendations for India

  • Develop continuous industry-training feedback loops.
  • Forecast required occupations and define competencies.
  • Redesign curricula and ensure practical apprenticeships.
  • Measure outcomes like employment, wages, and productivity for curriculum adjustments.

India must create a robust feedback mechanism connecting industry changes with educational content to realize its manufacturing goals effectively.

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