For Private Circulation only Ensuring Sustainable Offshore Delivery : India’s Skills Development Model : Opportunities for India Australia Partnerships.

For Private Circulation only

Ensuring Sustainable Offshore Delivery : India’s Skills Development Model :

Opportunities for India Australia Partnerships

25th July 2012 Melbourne, AustraliaDilip ChenoyCEO & MD

2Proprietary and confidential. This information does not represent and should not be construed as, legal or professional advice. © 2011 NSDC. All Rights Reserved.

Agenda

Overview Government Initiatives in Skill Development in India

NSDC Model: Encouraging Public Private Partnerships

Areas of Collaborations and Key Recommendations


India: Land of World’s Largest Young Population

22.2

17.0

13.9

10.2

6.9

4.3

2.1

0.6

22.9

25.6

21.3

17.3

13.3

9.4

6.3

4.2

1.8

0.8

0-9

10-19

20-29

30-39

40-49

50-59

60-69

70-79

80+

1991Age 2001 2011 202119.6

18.7

19.5

14.4

11.6

8.2

5.0

2.4

0.8

15.8

17.1

17.0

15.7

12.6

10.1

6.9

3.5

1.3

70% of the population will be in working age group by 202170% of the population will be in working age group by 2021

• Where the Population of rest of the world is relatively old, India has a great opportunity to harvest its ‘Demographic Dividend’

• Government’s policy to ensure that working population are skilled to meet requirements of the industries.


However, plagued by inadequately skilled manpower

High drop outs in the education space

1

In service training levels very low in India

4

Very low enrolments for VET

3

Skilling should Become a major

Policy Focus going forward

Skilling should Become a major

Policy Focus going forward Employability of the skilled a challenge

2

Only one in four engineering graduates in India is employable, based on their technical skills, English fluency, teamwork and presentation skills and of the 4 lakh odd engineering graduates, who graduate each year, only about 20% is good enough for India Inc.

- NASSCOM

5Proprietary and confidential. This information does not represent and should not be construed as, legal or professional advice. © 2011 NSDC. All Rights Reserved.Source: IMaCS analysis

Industry Incremental

requirement

(in million)

Building and Construction Industry 33.0

Infrastructure Sector 103.02

Real Estate Services 14.0

Gems and Jewellery 4.6

Leather and Leather Goods 4.6

Organised Retail 17.3

Textiles and Clothing 26.2

Electronics and IT Hardware 3.3

Auto and Auto Components 35.0

IT and ITES 5.3

Banking, Financial Services, and

Insurance

4.2

Furniture and Furnishings 3.4

Industry Incremental

requirement

(in million)

Tourism and Hospitality services 3.6

Construction Material and Building

Hardware

1.4

Chemicals and Pharmaceuticals 1.9

Food Processing 9.3

Healthcare 12.7

Transportation and Logistics 17.7

Media and Entertainment 3.0

Education and Skill Development

Services

5.8

Select informal employment sectors (domestic help, beauticians, security guards)

37.6

Incremental 347

Industry requires 347 million skilled manpower over 10 years for sustaining it’s growth


The National Skills Policy 2009 targets skilling 500 million people through 4 pronged approach

• No discrimination between private or public delivery

• Importance on outcomes, users choice

• Competition among training providers

Policy coordinati

on and coherence

• Promote excellence • Meet the

requirements of knowledge economy.

• A framework for better coordination among various Ministries, States, industry and other stakeholders

• Approach adequately communicated and implemented

• male/female• rural/urban• organized/

unorganized employment

• traditional/contemporary workplace

Choice,competition

and accountability

High inclusivity

Dynamic & demand-based system planning

India needs to create 500

million skilled workers by 2022


Social Appreciation of Skills As a Livelihood Asset

Linking Education to Employability in the Global Knowledge Economy.

No One Solution. Every Region demands an innovative approach.

1. Undertake fundamental reforms across the education system (primary, secondary and higher) to

• improve overall quality / outcomes,

• increase retention and

• ensure seamless integration with vocational training

2. Significantly enhance Government-driven vocational training efforts

3. Increase scale of PPP initiatives to better utilize Government infrastructure

4. Foster Private sector / Industry participation in skill development

New approach to addressing the gap


Government’s Co-ordinated Action in Skills Space

Multilateral , bilateral and private sector funding to NSDF


Why the “ New” Partnership Model

• For identifying the competencies and setting up standards as per Industry

requirements

• For delivery of training, monitoring and evaluation

• For participation in examination and certification

• For participation in affiliation and accreditation process

• For facilitating training of trainers

• For facilitating employment of trained persons

• Skill demand analysis and curriculum development

• Sharing of work place experience, machinery and equipment

• Support by way of physical, financial and human resources


Agenda





NSDC – a unique model created with a well thought through underlying philosophy

Create: Proactively catalyze creation of large, quality vocational training institutions

Fund: Reduce risk by providing patient capital

Improve returns by providing viability gap funding

Enable: Support systems required for skill development• Sector skill councils• Quality Assurance• Information system• Train-the-trainer• Set Standards

Key elements of NSDC’s underlying philosophy

1

2

3


Create : Inviting Private Sector to Make it Sustainable and Scalable

• Response to Demand• Develop a strategy • Create a knowledge base• Excite entrepreneurs by

bringing out the opportunity

• Go beyond the training, address issues of the ecosystem

• Develop partnerships, move beyond a pure funding relationship

• Focus on outcomes

• Share the risk • Provide patient capital • Develop non intrusive robust

monitoring programmes• Trust and transparency in the

system • Eco system to support the

organization

Attracting Industry players: Start ups, Social Entrepreneurs, NGOs, Medium Size Training Organizations and Large Corporates into Skill Development.


Driving vocational training business models by providing patient capital

• Any organization with scalable, sustainable business model that ensures employability of the resources trained

• Including start ups• Including Indian partnership with Australian Companies

Who gets funded?

What is the amount of funding?

What is the form of funding ?

DescriptionElements

• ~Upto 75% of the project cost

• Debt at subsidized rates ; other features like moratorium built in depending upon nature of project

• Equity • Grant funding (only in very select cases)

Is there special focus?

• NSDC is looking to fund businesses that seek to create employable people across all sections of the society


Proposal Evaluation Committee (PEC)

Proposal Approval Committee (PAC)

Diverse representation from the Government, private equity, NGOs, industry

Board

Representatives of key stakeholders – both government and private sector

Due diligence partnersNSDC team

Proposal Introduction and evaluation – test of responsiveness, technical, financial and legal due diligence

Turnaround of < =3 months targeted for proposals

Robust process designed to ensure rapid turnaround in the process

Active involvement of Government, Industry Leaders and leaders from Social Sector for approving projects, ensuring interest of all stakeholders.


Private partners from Industry, NGOs, Start Ups form NSDC Portfolio

Training providers

In the education business

In unrelated businesses

Start upsLarge established corporates

TechnableGOLS

Total Ten Year projections of 67 Million


Parameters As of June 2010 As of 31March 2011 As of June 2012Total Number of Partners' Approved 65

• Training Partners 3 25 52

• Sector Skill Councils 0 3 13

Total Active Partners 0 12 28

Total number of Centres - 82+484* 619 + 3041*

Number of People Trained - 20,482 212,664

Number of People Placed - 789 165,896Cumulative Placement Achieved - 70.1% 78%Total Funds Committed (in US $) $8.2 mn $120 mn $254mn

Total Sectors Covered 6 15 23

Note: *Pratham’s EFE centers.

Some early signs of success…


Multiple initiatives being taken by NSDC to develop the skills ecosystem, 2011-12 (I)

Sector skill councils Knowledge BaseFinancing for

vocational training

• 11 SSCs approved by NSDC

• 9 proposals getting evaluated; pipeline of about 10 proposals

• Slow but sure interest by industry

• District wise skill gap studies undertaken for the 8 NE states, Odhisa, Bihar, AP, Bihar, MP, Rajasthan, West Bengal and Karnataka

• In addition to 20 high priority sectors, sectors skill gap studies for infrastructure and sports sector

• A study on train the trainers conducted

1 2 3

• Vocational Loan on a Pilot basis

• Loan would in the range of Rs.5000/- to Rs.1,50,000/-

• Operate through tripartite agreement amongst Student (Trainee), Training Provider and the Bank

• NSDC would stand as a guarantor for a certain percentage of the default

National Qualification Framework

4

NSDC, IAMR and States have been involved by MHRD in evolving the NVEQF document from Dec 2010, and a Draft Note has now been prepared for Cabinet Approval.

Funding for a pilot in schools of Haryana and Bengal has been released. Four SSCs are engaged in this Pilot


Multiple initiatives being taken by NSDC to develop the skills ecosystem , 2011-12 – (II)

World skills competition

Business Plan competition

Media Campaign

• NSDC acted as nodal agency for the World Skills Competition hosted in London

• Results limited but good learnings

• Preparation underway for the 2013 competition

• “Power to Empower” – India’s first Skills enterprise competition organised by NSDC and CII jointly

• 71 educational institutions and over 3000 students participated in the competition

• Work on- going on a media campaign to make skills aspirational

Work with international organisations

Multiple international organizations being engaged with to leverage existing skills and knowledge base• UKIERI• ILO• AIEC• UKCES• EU• DFID

5 6 7 8


Sector Skill Councils : Ensuring Industry Involvement

TRAINING NEED ANALYSIS

CURRICULUM DEVELOPMENT

ROLLOUT OF TRAINING

ASSESSMENT AND

CERTIFICATION

• Creation of Occupational Standards

• Towards National Vocational Qualification Framework

• Labour Market Information System

• Skill Development Plan

• Accreditation of Training Institutes

• Academics of Excellence • Training of Trainers• Guidelines and Participate in

Assessments and Certification of Trainers and Trainees

• Sector Skill Councils (SSC) consists of representation from Industry Member, Government Bodies, Industry Associations, Business Leader and Training providers to ensure participation of all ecosystem members.

• Till now 11 SSC have been approved in main high growth sectors such as Automotive, Retail, IT/ITES, BFSI, etc.


Approved by NSDC

(11 till now)

SSC Proposals under Diligence with NSDC(10 SSC presently)

SSC Proposals in Pipeline

(9 SSC presently)

Auto Domestic Workers Mining

Security Construction and Real Estate Capital Goods

Retail Foundry Hospitality

IT/ITES Agriculture Pharmaceuticals

BFSI Handicrafts Beauty & Wellness

Media Textiles Steel

Healthcare Logistics & Transportation Aviation

Gems & Jewelry Plumbing Oil & Gas

Rubber Education and skills

Leather

Electronics Hardware

Telecom

Food Processing

Large Workforce

13 SSCs approved and a strong pipeline – June 201220 of the high priority sectors covered, move towards large and informal sectors

Priority Sectors

Informal Sector


Organization Support

International Network of Sector Skill Organizations

Seminar on Setting up SSCs held for all SSC leaders in May 2012 by 4 International Leaders of SSCs from UK & Australia

AIEC Support to Retail SSC – CEO of Service Skills Australia provided 2 week on site support in May- June 2012. Key areas covered, stakeholder engagement, Standards, LMIS, SSC processes etc. Preliminary talks to support one more SSC.

UKIERI 1. Project Funding released by end April2. Two SSCs, Agriculture & Media to be provided on site support3. A second UKIERI fund provides for support to Food Processing

SSC

EU Project to support three SSCs in capacity building over three years. Year 1 focus on Auto SSC.

NSDC Workshop and Framework to 10 SSCs for creation of NOS in occupations covering 80% of workforce, by individual RFPs.

NSDC also receiving support from multiple international organizations in SSC incubation


Agenda





Current Collaborations with Australia:Several MOUs Signed between Australia and India

• MOU between XLT and Jaypee Group: Training to focus on metals, construction, automotive and mining

• TAFE NSW- Sydney Institute and Heraud Inc : MOU to provide services to proposed College,

facilitating academic collaboration, professional development, study tours, student and teacher exchange, and international student recruitment.

• Central Institute of Technology (Australia) and the Central Board of Secondary Education (CBSE): To develop models of VET engagement to help students to complete school with both a secondary school certificate and job oriented and job linked skills. Pilot with delivery of 4 courses- Design, Retail, Music production and Beauty therapy.

• Australian Vocational Training Employment Group (AVTEG) and JIS Group

• College of Innovation and Industry Skills (CIIS) and JIS Group

• Kangan Institute in Australia to support training of 425 ITI teachers in Karnataka and Maharastra.


Possible areas of collaboration

• To set up skill development programmes in cooperation with NSDC or

NSDC Partners

• Industry based curriculum development

• Training of Trainers including NSDC Partners

• Sharing of best practices in training particularly in sectors such as

Mining, Construction, Retail, Healthcare, Hospitality etc.

• Training in Agriculture: Sharing International standard training

modules for India to learn.


Possible areas of collaboration: Sector Skill Councils

• Capacity building and organizational support for Sector Skill Councils

• Sharing standards in development of Occupational Standards

• Development of Curriculum Framework

• Sharing best practices in assessments, certifications and

accreditation.

• Development of Labour Market Information System

• Development of Qualification Framework


Multiple forms of interventions possible on the skill development space

Systematically focus on areas and create skill led community interventions

Build capacity to train and skill people• Own capacity

Use expertise in certain areas to provide curriculum and training material in select areas

Leverage and consolidate existing capacity to deliver quality training

Community based interventions

Build capacity

Standards and Curriculum

Leverage existing capacity

INTERVENTIONS


Different business models can be builtIllustrative : Single Entity with different Centre's

Option 1 Key activities

Skills Centre

COE for Sales ….COE for Sector 1

Corporate training for Sector 2

Learning centre n

Learning centre 2

Learning centre 1

Research and development of content

Methodology

Train the trainer

Overall strategy and management

Sector specific centres of excellence

Focus on sector requirements

Regarded as best in class training centres for a particular sector/ function

Learning centres (owned) dispersed all over the country for sector/ functional expertise

Innovative models can be developed depending upon requirements of the secotr


Different business models can be builtIllustrative : Multiple corporate / Training entities partnering

Option 2 Key activities

Holding Entity : Lead player

COE for SalesEntity 1

….

COE for Customer Service Entity 2

COE for Sector Entity 3……

Learning centre n

Learning centre 2

Learning centre 1

Research and development of content

Methodology

Train the trainer

Overall strategy and management

Sector/ area specific centres of excellence led by different firms

Focus on sector requirements

Regarded as best in class training centres for a particular sector/ function

Learning centres (owned) with different entities dispersed all over the country for sector/ functional expertise

Innovative models can be developed depending upon requirements of the secotr

29Proprietary and confidential. This information does not represent and should not be construed as, legal or professional advice. © 2011 NSDC. All Rights Reserved.Source: BCG Analysis

A LEADER IS ONE WHO TAKES THE FIRST STEP TOWARDS A GOAL HE DEEPLY CARES ABOUT, IN WAYS

THAT OTHERS WISH TO FOLLOW

Take Charge Leaders!

Thank youContact Information:

[email protected]

For Private Circulation only Ensuring Sustainable Offshore Delivery : India’s Skills Development Model : Opportunities for India Australia Partnerships.

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