At least six clusters of public-sector industrial training institutes (ITIs) are expected to begin upgrading over the next two months, as the government seeks to rope in more companies for a scheme to bolster India’s vocational training ecosystem, an official privy to the development told FE.
The national steering committee for the scheme, chaired by the secretary of the ministry of skill development and entrepreneurship (MSDE), approved 15 strategic investment plans (SIPs), while another 20 are in the pipeline and expected to be completed over the next couple of months, the source said. This could take the total number of approved SIPs to around 35. “At least six clusters should start the process in the next two months. We have a pipeline of 20 more SIPs,” the official said.
Under the Pradhan Mantri Skilling and Employability Transformation through Upgraded ITIs (PM-SETU), each cluster typically comprises five ITIs — one hub and four spokes — and is covered by one SIP. The official said that 15 approved SIPs will likely cover 76 ITIs.
The official said major companies have joined the initiative, with Jindal Steel taking two clusters — one each in Haryana and Odisha. Apollo MedSkills has taken the Hyderabad old city cluster, while Tata Steel is taking a cluster in Odisha. The official said the ministry was seeing interest from companies across different sectors.
Launched in October 2025, the PM-SETU scheme aims to upgrade 1,000 government ITIs into modern, industry-aligned training institutions.
These will be organised into 200 clusters, each comprising one hub ITI and four spoke ITIs. The scheme is designed as a five-year programme, with funding shared by the central government, state governments and industry partners.
Under the funding arrangement, the Centre will broadly contribute 50% of the investment, states 33% and industry partners around 17%. However, the industry’s contribution is not capped at 17% and can be higher depending on the investment plan submitted for each cluster, the official said. Industry partners will hold a 51% stake in the special purpose vehicles (SPVs) formed to manage the clusters, giving them the majority say in running the institutions and aligning training with their requirements.
The official said an SPV to manage the Bhiwadi cluster has already been incorporated, with the Rajasthan government and HG Infra Engineering as shareholders. “The shareholder agreements for two other clusters have been signed, although their incorporation will take some time as companies need to complete legal scrutiny and obtain board approvals before joining the partnerships,” said the official.
Once an SPV is incorporated, the industry partner will prepare an annual operating plan, after which upgradation work can begin. The nature of work will vary across clusters depending on their requirements. This could include setting up new labs and hostels besides upgrading existing infrastructure.
“Every cluster will have different needs. That is what the investment plan specifies. It also lays out how the money will be spent over the next five years,” the official said.
Apart from infrastructure, the scheme will focus on introducing new courses and industry-oriented training, with short-term programmes expected to begin within the next three months.
The government is also allowing states flexibility in deciding the duration of their partnerships with industry. While the central government’s capital expenditure commitment is spread over five years, concession agreements between states and industry partners can extend beyond this period. Rajasthan, for instance, has opted for a 10-year concession agreement.
“Part of it is also building industry confidence. It took us some time to get in the first industry. But now it is moving faster,” the official said. The government is also seeking to align ITI clusters with major industrial investments in different regions so that training programmes reflect local demand for skilled workers.
Source: The Financial Express
