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PolitySource: Economic Times

PM SETU Scheme Launched for Skill Development and Employability Improvement

Thursday, 12 March 2026
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Key Points

The launch of the PM SETU Scheme marks a pivotal moment in India's skill development landscape, aiming to enhance employability through upgraded ITIs. This initiative is significant for UPSC aspirants, particularly for GS Papers 2 and 3, focusing on governance, social justice, and economic development. Last Updated: 12-03-2026

Key Facts About PM SETU Scheme

  • The PM SETU Scheme was approved by the Union Cabinet in 2025 with a budget of Rs. 60,000 crore.
  • It aims to align skill training with modern industry needs, marking a shift to industry-led skilling.
  • The scheme adopts a hub-and-spoke model with 200 Hub ITIs supporting nearby Spoke ITIs.
  • Five National Skill Training Institutes in Bhubaneswar, Chennai, Hyderabad, Kanpur, and Ludhiana will be transformed into Centres of Excellence.
  • Each upgraded ITI is governed by a Special Purpose Vehicle (SPV) with industry holding 51% ownership.
  • Industry partners can receive up to 83% government funding for infrastructure improvements.
  • The scheme introduces 31 new-age courses under the Craftsmen Training Scheme (CTS).

India's Skill Development Transformation

The PM SETU Scheme represents a strategic shift in India's approach to skill development, aligning with national goals of economic growth and employment generation. By fostering industry participation, it aims to create a workforce ready for global challenges, enhancing India's competitiveness. This initiative is crucial as India seeks to improve its global ranking in skill development and employability.

UPSC Relevance

  • GS Paper 2: Governance and Social Justice - Role of government policies in skill development.
  • GS Paper 3: Economic Development - Impact of industry-led training on economic growth.
  • Prelims: Questions on scheme objectives, budget allocations, and governance structures.
  • Mains: Analytical themes on public-private partnerships in education and skill development.

FAQ Section

  • What is the PM SETU Scheme?
    The PM SETU Scheme is a government initiative aimed at upgrading ITIs to enhance skill development and employability in India.
  • Why is the PM SETU Scheme important?
    It is crucial for aligning vocational training with industry needs, thereby improving job readiness and supporting economic growth.
  • What are the key features of the PM SETU Scheme?
    Key features include the hub-and-spoke model, industry-led training, SPV governance, and the introduction of new-age courses.

Detailed Coverage

  • PM SETU Scheme launched for skill development and employability improvement.
  • Constituted National Steering Committee to guide the initiative.
  • Approved by the Union Cabinet in 2025.
  • Budget allocation of Rs. 60,000 crore.
  • Focus on aligning skill training with modern industry needs.
  • Shift from government-driven to industry-led skilling.
  • 200 “Hub” ITIs to serve as central institutes.
  • Each Hub will mentor approximately four “Spoke” ITIs.
  • Enhancement of five National Skill Training Institutes (NSTIs).
  • Governance through a Special Purpose Vehicle (SPV).
  • Industry partners hold 51% ownership in SPVs.
  • Government retains 49% ownership.
  • Up to 83% government funding for industry partners.
  • Invitation for Anchor Industry Partners to collaborate.
  • Introduction of 31 new-age courses under Craftsmen Training Scheme.
  • Focus on sectors like advanced manufacturing, electronics, mobility, and logistics.
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Practice Questions

Test your understanding of this article

Question 1 of 50 / 5 answered
1

As part of the PM SETU Scheme, the Directorate General of Training has introduced a series of courses to address the needs of emerging sectors. How many new-age courses have been launched under this initiative to align skill training with industry demands?