In a significant step towards revamping vocational education and addressing the rising demand for skilled workforce, the Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the National Scheme for Upgradation of Industrial Training Institutes (ITIs) and the establishment of five National Centres of Excellence (NCOEs) for Skilling, according to an official statement released on Wednesday.
The initiative will be implemented as a Centrally Sponsored Scheme with a total outlay of Rs.60,000 crore over five years. The funding will include Rs. 30,000 crore from the Centre, Rs. 20,000 crore from State Governments, and Rs. 10,000 crore from industry partners. Additionally, 50% of the central share will be co-financed equally by the Asian Development Bank and the World Bank.
Revamping India’s Skilling Landscape
The scheme envisions the upgradation of 1,000 Government ITIs in a hub-and-spoke model aligned with industry needs and the capacity augmentation of five National Skill Training Institutes (NSTIs) located in Bhubaneswar, Chennai, Hyderabad, Kanpur, and Ludhiana. These NSTIs will also house the new National Centres of Excellence.
The goal is to reposition ITIs as aspirational, government-owned, and industry-managed institutions, offering revamped courses that reflect the evolving skill requirements of modern industries. Over five years, the scheme aims to skill 20 lakh youth through industry-aligned training programs.
Bridging Skill Gaps in High-Growth Sectors
The Cabinet statement highlighted that previous financial assistance for ITI infrastructure development was insufficient to address the growing needs of new-age trades and capital-intensive training. The new scheme introduces a need-based investment model, offering flexibility to institutions to enhance infrastructure and introduce relevant trades.
To ensure effectiveness, the scheme will adopt an industry-led Special Purpose Vehicle (SPV) model—marking a major shift from earlier government-only approaches. This will enable close collaboration between ITIs and industry in curriculum planning, infrastructure upgrades, and ongoing management.
Focus on Trainers and Employability
The initiative also aims to strengthen Training of Trainers (ToT) by upgrading infrastructure in the five NSTIs and offering pre-service and in-service training to 50,000 trainers. This is expected to enhance the quality and consistency of vocational education across the country.
The scheme will address long-standing issues related to infrastructure gaps, outdated course content, low employability, and the perception of vocational training as a less desirable education route. It aims to make vocational training a central pillar of India’s industrial and economic growth, especially in emerging sectors such as electronics, automotive, and renewable energy.
A Vision for ‘Viksit Bharat’
The newly approved scheme aligns with the Prime Minister’s vision of ‘Viksit Bharat’ (Developed India) by 2047, with skilling as a key enabler of inclusive growth and global competitiveness. With a significantly expanded ITI network—currently over 14,600 institutes with 14.4 lakh enrolled students—this scheme is seen as a timely intervention to create a future-ready workforce.