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Govt plans to spend Rs 5,000 crore on skilling unorganized workers

IBEF:  July 22, 2019

Skill mission promoted by government is planning to shift its focus from the formal to informal sector with an annual expenditure of around Rs 5,000 crore (US$ 695 million). This comes as a move in sync with government’s lean towards creating more beneficiaries.

The ministry of skill development and entrepreneurship thinks that though there has been a strong focus on the formal sector in the last five years, it left out 93 per cent of the workforce in the informal sector.

Therefore, it is believed that lest the informal sector is targeted, the skill mission will not be successful. This was also noted at a recent meeting at the Prime Minister’s Office.

The focus of the mission was on 7 per cent of the work force, which was involved in formal sector, without realizing the ignorance towards rest 93 per cent. That’s a big recognition for the ministry and all the 22 departments of the Union government who have some skilling agenda. All 22 departments will slowly shift their focus to informal and unorganised sector.

The skill  development ministry along with the ministry for rural development can collectively spend Rs 4,000 crore(US$ 556 million)  a year for skill training manpower for the informal sector and with the government departments pooling in, the total spending can touch around Rs 5,000 crore (US$ 695 million) to help small organizations improve, get better manpower or train their existing workforce to enhance their productivity. Estimates shows that at least 80 per cent of the labour market is working in businesses having less than six employees. The skills ministry is working on some small-scale initiative to effectively implement it across the country.

Authorities said the Centre will partner states especially at the municipality and block level to reach the target audience.

However, it is believed that states will have to play a pro-active role and the Centre will have to persuade them that such a shift will benefit most of the people at the grass root level.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.