MINT ( 17 May 2016 ) carries a report titled :
" Govt taps profitable PSUs for Skill India Mission "
As per this report , Shri Rajiv Pratap Rudy , Skills Development Minister , has asked all profitable PSUs to take in apprentices equal to 2.5 % of their total workforce
With barely 50-60 PSUs which are " profitable " , this directive is unlikely make a dent , as far as Government target of training 120 million persons by 2020 is concerned
REASON ?
As of now , a total of 28,500 industrial establishments ( Public Sector + Private Sector ) , between them , have 200,000 apprentices . Adding 50/60 " profitable " PSUs cannot make much of a difference !
CONTRAST :
As against our total of 2 lakh apprentices , China has 300 lakh !
WHAT NEEDS TO BE DONE ?
> JOB CREATION
" Govt taps profitable PSUs for Skill India Mission "
As per this report , Shri Rajiv Pratap Rudy , Skills Development Minister , has asked all profitable PSUs to take in apprentices equal to 2.5 % of their total workforce
With barely 50-60 PSUs which are " profitable " , this directive is unlikely make a dent , as far as Government target of training 120 million persons by 2020 is concerned
REASON ?
As of now , a total of 28,500 industrial establishments ( Public Sector + Private Sector ) , between them , have 200,000 apprentices . Adding 50/60 " profitable " PSUs cannot make much of a difference !
CONTRAST :
As against our total of 2 lakh apprentices , China has 300 lakh !
WHAT NEEDS TO BE DONE ?
> JOB CREATION
We should , simultaneously amend the Apprentice Act - 1951
Under the amended Act , every factory will be required to take fresh
Apprentices in the ratio of 1 : 3 ( one trainee for three permanent
employees , in each trade ) , instead of current prescribed ratio of 1:7
This will create a huge demand for ITI trained students
> COST REDUCTION
Since ITI trained apprentices are paid a stipend ( generally 20 % of the
wages paid to regular / permanent / skilled workers ) , this will sharply
reduce the manpower costs of manufacturing units
This will lead to India becoming a " Low Cost Economy " and increase the
competitiveness of our products , in the international markets , thereby
boosting our exports ( currently , a meager 1.7 % of World Trade ! )
This is the major reason why Foxcon ( Taiwan ) wants to put up 10
factories in India , at an investment of $ 20 billion
> ADVANTAGE , MSME
Under amended Apprentice Act , permit MSME to retain ITI trained skilled
workers , on a stipend-basis , for 4 years ( instead of current 2 years )
This lowering of wages will make MSME very competitive in their cost.
In turn , this will encourage large organized factories to outsource /
sub-contract more components to MSME , instead of manufacturing
in-house
This will result in a robust " Supply Chain Eco-System "
It is such an Eco-System in China , which compels Apple to have 331
Component-Suppliers in China as against ONE supplier from India !
> PRODUCT QUALITY
Product quality depends upon quality of skilled manpower coming out of
ITIs
When lakhs of ITIs are competing with one another for attracting
students , each will try to raise the quality of its training
When such highly trained students enter work force , quality of " Make
in India " products , is bound to rise
> PERCENTAGE OF SKILLED WORKERS
Of the total work force , percentage of skilled workers in India today , is
meager 3.5 % , as against 96 % in South Korea !
If my suggestion gets implemented , we should be able to raise this
figure to at least 50 % in next 10 years !
> DEMAND FOR TEACHERS
There will be a huge surge in demand for Highly Skilled persons to act as
teachers / trainers in 4.4 lakh ITIs
> SELF EMPLOYMENT
MUDRA bank will provide loans to ITI trained skilled workers to set up
themselves as local area Carpenters / Electricians / Plumbers / Welders /
Masons / Repairers etc
Thousands of ITI trained workers will tend to become Self Employed
Just tell our 50 million MSMEs ( and all larger units, as well ) :
* " Train " Apprentices ( low cost labour ) , then
* " Hire " them for longer periods ( - again , low cost labour ) ,
* Reduce your manufacturing cost ( to become competitive world-wide ) ,
* Become more profitable ( and sooner )
It is time to stop tinkering with persuading of PSUs
It is time to harness " Greed " to " Skill India "
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www.hemenparekh.in / blogs
19 May 2016
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