India: Capacity Building of the National Skill Development Agency

Sovereign Project | 46461-001

Summary

The proposed TA "Capacity Building of the National Skill Development Agency" is in line with the country partnership strategy, 2009-2012 for India, which aims at supporting India's efforts toward inclusive growth, and the country operations business plan, 2013-2015 for India, which recognizes education as a new sector in Asian Development Bank (ADB) operations in India. The project is fully aligned with Strategy 2020.

The project's impact is strengthened skills ecosystem to ensure that 12th Five Year Plan (2013-2018) targets and beyond are met, and its outcome is enhanced capacity of NSDA to guide quality skills development initiatives across central ministries, states, and the private sector.

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Project Name Capacity Building of the National Skill Development Agency
Project Number 46461-001
Country India
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8626-IND: Capacity Building of the National Skill Development Agency
Japan Fund for Poverty Reduction US$ 1.50 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Knowledge solutions
Partnerships
Sector / Subsector Education - Education sector development
Gender Equity and Mainstreaming Gender equity
Description

The proposed TA "Capacity Building of the National Skill Development Agency" is in line with the country partnership strategy, 2009-2012 for India, which aims at supporting India's efforts toward inclusive growth, and the country operations business plan, 2013-2015 for India, which recognizes education as a new sector in Asian Development Bank (ADB) operations in India. The project is fully aligned with Strategy 2020.

The project's impact is strengthened skills ecosystem to ensure that 12th Five Year Plan (2013-2018) targets and beyond are met, and its outcome is enhanced capacity of NSDA to guide quality skills development initiatives across central ministries, states, and the private sector.

Through this proposed CDTA for National Skill Development Agency (NSDA), ADB will be able to engage with NSDA which has the mandate of ensuring convergence across the various national and state level skill development initiatives, and of building the capacity of SSDMs. There will therefore be significant positive synergies between the proposed CDTA and ADB's loan operations in India. It aims to enhance the employability of the youth of that state by improving the quality and delivery of skills training and secondary education. This loan will help the Meghalaya State Skill Development Mission in scaling up outcomes-based skills training by facilitating PPPs in skills training. It will also support tracer studies and skills-gap analyses to guide the skill development programs.

Project Rationale and Linkage to Country/Regional Strategy

The low employability of India's youth is one of the major binding constraints to inclusive growth. More than 50% of India's population of 1.3 billion is below 25 years, and around 65% is below 35 years in age. Of India's working age population (aged 15 to 59 years) of 431 million, 29% is illiterate and another 24% has studied only until the primary level or below. Only 17% of the labor force has senior secondary (grades 11 and 12) and higher levels (including diplomas, graduates, and above) of education.

It is estimated that 57% of India's youth suffer from some form of unemployability. Surveys show that only 30% of India's information technology (IT) graduates, 25% of engineering graduates, and 15% of finance and accounting professionals are suitable for employment. Currently, most companies have to spend substantial resources for retraining their new recruits which adds to their costs and erodes competitiveness. This poses a major constraint for both Indian companies and for companies from advanced countries such as Japan which are keen to scale up investment in India.

While each year nearly 13 million new workers join the labor force, India's annual skills training capacity is only 5 million. Further, the reach of these training programs is limited, and the quality is often below par. These facilities and programs need to be upgraded and aligned more closely with India's emerging labor market needs and changing economic structure. The Government of India's skills development initiatives are fragmented across 21 line ministries (e.g., Ministries of Labor and Employment; Human Resource Development; Rural Development; Micro, Small, and Medium Industries; Industries and Commerce; Power; and Textiles) leading to duplication of effort and wastage of resources. Most of these government-sponsored training programs are not adequately responsive to the private sector's evolving needs. Moreover, it is difficult to tailor these centrally-driven programs to meet the specific needs and constraints of the 28 states and 7 union territories of India, which are fairly diverse.

The recent establishment of the NSDA as the apex autonomous coordinating body for skills development programs is therefore, a major step in the right direction. NSDA subsumes the Prime Minister's National Council on Skill Development, the National Skill Development Coordination Board, and the Office of the Adviser to the Prime Minister on Skill Development. The Department of Economic Affairs, Ministry of Finance, Government of India is the nodal department responsible for providing planning, logistics and budgetary support to NSDA. The establishment of the NSDA will help to ensure convergence across the skills development programs at the central level being driven by multiple ministries. NSDA will also guide the various state skill development missions (SSDMs), which are mostly nascent, through analytical advice (e.g., benchmarking surveys, tracer studies, and preparation of the required training manuals), and channelize financial support to them in the coming years.

Impact Improved coordination and quality of skills development programs at the central and state levels
Project Outcome
Description of Outcome Enhanced capacity of NSDA for quality skills development across central ministries, states, and the private sector
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

1. NSQF operationalized

2. Capacity development program implemented

3. Knowledge product and dissemination workshops conducted

4. Partnership with international vocational development agencies facilitated

5. Improved project management

Status of Implementation Progress (Outputs, Activities, and Issues) The consulting firm for NSDA's capacity development is being recruited. The national and international consultants for the National Skills Qualification Framework have been recruited.
Geographical Location
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design

ADB coordinated closely with the Department for International Development (DFID), JICA, World Bank, and other development partners while designing its overall assistance program in India. Ongoing dialogue with the Department of Economic Affairs, Ministry of Finance, GOI, ensures that there is no duplication across the donors.

In addition, ADB is also holding consultations with other states such as Kerala, Karnataka, Odisha, and Rajasthan.

During Project Implementation TBD
Business Opportunities
Consulting Services A total of 104 person-months of consulting inputs will be provided under the TA: 18 person-months of international and 86 person-months of national consultant services. ADB will engage four individual consultants (for 30 person-months) as well as a firm (for 74 person-months). The selection and engagement of the consulting inputs will be carried out in accordance with ADB's Guidelines on the Use of Consultants (2013, as amended from time to time). The consulting firm will be selected on the basis of a full technical proposal in accordance with quality- and cost-based selection procedures. A quality to cost ratio of 90:10 will be followed.
Procurement All TA-financed goods and equipment such as computers, fax machine, multimedia projector, photocopier, printer, and other required items will be procured in accordance with ADB's Procurement Guidelines (2013, as amended from time to time). The procured equipment will be handed over to NSDA upon TA completion.
Responsible ADB Officer Brajesh Panth
Responsible ADB Department South Asia Department
Responsible ADB Division Human and Social Development Division, SARD
Executing Agencies
Department of Economic AffairsMinistry of Finance
North Block
New Delhi-110001, India
Timetable
Concept Clearance 30 Oct 2013
Fact Finding 31 Jul 2013 to 08 Aug 2013
MRM -
Approval 07 Mar 2014
Last Review Mission -
Last PDS Update 02 Mar 2015

TA 8626-IND

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
07 Mar 2014 15 Jul 2014 15 Jul 2014 30 Apr 2016 - -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
0.00 1,500,000.00 250,000.00 0.00 0.00 0.00 1,750,000.00 07 Mar 2014 155,055.59
Title Document Type Document Date
Capacity Building of the National Skill Development Agency Technical Assistance Reports Mar 2014

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