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The Skill Impact Bond (SIB) 2025 report highlights India’s shift to outcome-based skilling. Jharkhand leads in trainee share, with women dominating apparel sector enrolment. However, gender pay gaps and retention challenges persist.
KEY CONCEPTS/TERMS
| Term | Explanation |
|---|---|
| Skill Impact Bond (SIB) | India’s first Development Impact Bond (DIB) launched in 2021, aimed at linking skilling with job placement and retention. |
| Outcome-Based Skilling | Focus on long-term job retention and performance instead of just enrolment numbers. |
| DIB (Development Impact Bond) | A results-based financing model where private investors fund programs and are repaid based on performance outcomes. |
| Skill India Digital Hub (SIDH) | Digital platform connecting learners, trainers, and employers for seamless skilling. |
| SANKALP | World Bank-supported project to improve skilling quality and market alignment. |
| STRIVE | Scheme to strengthen ITIs and promote industry-institute partnerships. |
SKILL IMPACT BOND 2025: HIGHLIGHTS
| Category | Key Findings |
|---|---|
| Enrolment | 27% from Jharkhand; others from UP, Maharashtra, Odisha, Telangana. |
| Gender Focus | 72% of 23,700+ trainees were women from marginalised communities. |
| Sector Trends | Women: Apparel, retail, ITeS, BFSI. Men: Shift from construction to automotive, telecom. |
| Job Outcomes | 75% placement rate, 60% retained jobs >3 months; female employment up from 35% to 48%. |
| Certification Rate | Female certification rate at 92%. |
| Self-Employment | Women’s self-employment rose from 6% to 14%. |
| Pay Gap | Men earned ₹12,400–15,700; women earned ₹11,500–13,000 despite similar job performance. |
STATUS OF SKILL DEVELOPMENT IN INDIA
| Indicator | Status |
|---|---|
| Employability | Only 51.25% youth deemed employable (India Skills Report 2024). |
| Formal Training | Only 4.4% of youth formally skilled (Economic Survey 2023–24). |
| Skill Gap | 60–73% gap in tech roles like ML engineer, DevOps, Data Scientist. |
| Underemployment | 50% of graduates in low-skill jobs (Economic Survey 2024–25). |
| Women in STEM | 40% of STEM students, but only 14–27% become professionals. |
KEY CHALLENGES IN SKILLING ECOSYSTEM
| Challenge | Details |
|---|---|
| Poor Infrastructure | Many rural ITIs lack trained staff and updated tech. |
| Industry Disconnect | Curricula often misaligned with real job requirements. |
| Urban Bias | 90% of informal workforce in rural areas is left out; only 10% of rural workers receive formal training. |
| Low Private Sector Role | Minimal private participation due to complex regulations and weak academia–industry links. |
| Gender Gaps | Persistent gender pay disparity and underrepresentation in high-paying sectors. |
KEY SKILLING INITIATIVES
| Scheme | Objective |
|---|---|
| Skill India Mission | Umbrella scheme for vocational and technical skill training. |
| PMKVY | Short-term training and certification for youth. |
| PM-NAPS | Incentivises employers to hire apprentices. |
| PM Vishwakarma Yojana | Targets traditional artisans and craftspeople. |
| ISA (India Skills Accelerator) | Enhances job-readiness and industry connect. |
| DDU-GKY | Focus on skilling rural youth for wage employment. |
| RPL | Recognition of informal skills via certification. |
WAY FORWARD TO REFORM INDIA’S SKILLING LANDSCAPE
| Reform | Strategy |
|---|---|
| Inclusive Rural Skilling | Launch Rural Skilling Mission for agri-tech, crafts, mobile training vans, village tech hubs. |
| Digital & Future-Ready Skills | Align skilling with AI, Green Jobs, 5G. SSCs to co-create courses with gig platforms and MSMEs. |
| Women’s Skilling | Flexible programs with childcare, financial incentives, STEM focus, mentorship and digital access. |
| School-Integrated Vocational Education | Introduce skill training from school level under NEP 2020, link with National Credit Framework. |
| Robust Monitoring | Use AI dashboards, biometric attendance, geo-tagging, outcome-linked funding and third-party audits. |
IN A NUTSHELL (Memory Code: S-K-I-L-L B-O-N-D)
- S – Self-employment in women up 2x
- K – Key sectors: apparel, ITeS, BFSI growing
- I – Inclusive skilling for vulnerable youth
- L – Long-term retention >60%
- L – Low formal training at 4.4%
- B – Bridging pay gap still a challenge
- O – Outcome-based funding via SIB
- N – NEP-linked vocational education
- D – Digital expansion via SIDH & AI tools
PRELIMS PRACTICE QUESTIONS
- Which of the following best describes the Skill Impact Bond (SIB)?
A. Government-funded scheme for skill training
B. A Corporate Social Responsibility initiative
C. An outcome-based skilling model funded through private capital
D. A loan program for micro-enterprises - Consider the following statements:
1. The SIB focuses on enrolment numbers and syllabus completion.
2. It is India’s first development impact bond aimed at skill training and job placement.
Which of the above statements is/are correct?
A. 1 only
B. 2 only
C. Both 1 and 2
D. Neither 1 nor 2 - Which of the following are major challenges in India’s skilling ecosystem?
1. Industry disconnect
2. Urban bias in training programs
3. High female participation in STEM roles
Select the correct answer using the code below:
A. 1 and 2 only
B. 1 and 3 only
C. 2 and 3 only
D. All of the above
MAINS PRACTICE QUESTIONS
- What are Development Impact Bonds (DIBs)? How is the Skill Impact Bond model transforming India’s skilling landscape? 15 Marks (GS2 – Government Policies)
- Despite multiple skilling initiatives, India faces a wide employability gap. Examine the key challenges and suggest reforms to create a future-ready skilled workforce. 15 Marks (GS3 – Inclusive Growth)
PRELIMS ANSWER KEY
| Q No. | Answer | Explanation |
|---|---|---|
| 1 | C | SIB is funded by private investors and rewards outcome, not enrolment. |
| 2 | B | Only statement 2 is correct; statement 1 is false. |
| 3 | A | Female participation in STEM roles remains low, not high. |
