The National Skills Development Corporation (NSDC) is a public-private partnership formed under India’s Ministry of Finance, with 51 percent equity held by private sector and the remaining 49 percent by the Government of India. NSDC is managed by a Board of Directors with representatives from all parties and receives funding from the National Skills Development Fund (NSDF), which is fully financed by the government with approximately $319 million allocated to make sustainable investments in partner organizations. The NSDC's primary goal is to train 150 million people by providing catalytic funding and support for private sector initiatives. Its main activities include:
- Supporting vocational training institutions through soft loans, which cover up to 75% of the total project costs. The NSDC seeks to fund NGOs, businesses, social entrepreneurs, and skill development organizations that are sustainable, large-scale, and partnership-based. These parties, known as the NSDC's partner training institutions, are expected to become self- sustainable within 3 to 5 years. As of 31st December 2013, NSDC has approved 114 loans to training partners, of which 68 are active with over 2500+ training centers spread across 352 districts in India. These partners have skilled 1.16 million people, of which 60% are already employed.
- Conducting labor market research to better understand the skills gap facing the nation. So far, the NSDC has already mapped skills gaps across 26 states in India, with remaining 3 are progress. NSDC is also conducting revised skill gap studies for 22 high growth sectors in India, which are expected to be completed by 31st March 2014.
- Establishing and funding Sector Skill Councils (SSCs) to strengthen the labor market in high growth industries through grant-based seed funding to cover start-up costs. As on 31st December, NSDC has approved 28 SSCs, of which 17 are already operational, with 2747 Occupational Standards already in place. These SSCs are industry and employer-led organizations that are responsible for sector-specific activities such as analyzing needs in the labor market, developing occupational standards and curriculum for training, and certifying training institutions. SSCs are expected to become self-sustaining within 5 to 7 years.
- Engaging with other stakeholders and coordinating targeted advocacy campaigns. Partners include the Centre for Civil Society (CCS), Indian School of Business (ISB), World Skills Competition, Federation of Indian Chamber of Commerce and Industries (FICCI), and India@75 etc. The NSDC also works with ministries and state governments to foster greater local and sector-specific initiatives and research. In addition, NSDC continues to work with organizations which focus on skill development for Women and/or People with Disabilities (PWD).
- Enabling the ecosystem. NSDC is also operating one of the world’s largest skills incentive program, called the National Skill Certification and Monetary Reward Scheme, or STAR. This program encourages youth to enroll in and complete programs run by training providers approved by the SSCs. Once these youth obtain a certificate, they are conferred a monetary reward of an average of Rs. 10,000 ($161). The scheme was rolled out across India in September 2013, and in its first four months has enrolled more than 100,000 people across 16 sectors.
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CEI approaches in action
- 114 training partners, of which 68 are active
- 2500+ training centers spread across 352 districts in India
- 1.16 million people trained by these partners, of which 60% are already employed
- 28 Sector Skills Councils (SCCs) approved, of which 17 are operational
- 2747 Occupational Standards in place
The NSDC originated as a large-scale initiative targeting skills training at the national level. After slow growth in its first two years of operation, the NSDC has developed and reached about 16% of its annual goal, training about 75,000 students each year.
Monitoring & Evaluation
Partner organizations that receive funding are responsible for setting their own project targets, which the NSDC ultimately uses to disburse or withhold funds. The NSDC works with projects to help overcome short-term challenges and reach scale, but reserves the right to withhold future funding if organizations do not put plans in place to improve their own performance. The NSDC requires organizations to reach at least 70% of employment among graduates.
In 2011-2012, NSDC-affiliated centers had reached a 79% employment rate among graduates.
The NSDC has so far only been able to achieve about 16% of its annual goal, training about 75,000 people each year.