Closing the Skill Gap in India: How the Government and Corporate Sector Are Empowering the Workforce

 

India, with its young population, holds tremendous potential to be a global leader in industries

like Artificial Intelligence (AI), deep tech, and advanced engineering. However, despite

producing millions of graduates every year, a large percentage of them are unemployable due

to a lack of industry-relevant skills. According to various reports, more than 50% of

engineering graduates in India lack the skills necessary for employment in high-growth

industries.


This significant skills gap has become a bottleneck in India's growth trajectory, particularly in

sectors like AI, data science, deep tech, and advanced engineering. Recognizing this challenge,

both the Government of India and the corporate sector have taken numerous initiatives to

bridge the gap and build a future-ready workforce.


In this blog, we’ll explore the skill gap challenge, initiatives taken by the government and

corporate sectors and identify key companies that are working towards skilling India's youth.

Additionally, we will discuss which listed companies stand to benefit the most from this skilling

revolution in the coming decade.


1. Understanding the Skills Gap in India

The National Employability Report has highlighted the stark reality that over 80% of Indian

engineering graduates are unemployable in the knowledge economy without additional

training. Graduates lack critical soft skills, technical know-how, and hands-on experience in

emerging technologies like AI, machine learning (ML), blockchain, and deep tech.

Several factors contribute to this skills gap:


● Outdated curricula in universities and colleges.

● Insufficient focus on practical, hands-on learning.

● Lack of alignment between industry needs and academic teaching.

● Inadequate training in communication, leadership, and problem-solving.


2. Government Initiatives to Bridge the Skills Gap

The Government of India has recognized this challenge and launched several initiatives aimed

at enhancing the employability of graduates and building a future-ready workforce. Here are

some of the key programs:


a. Skill India Mission

Launched in 2015, Skill India aims to train over 400 million people in various skills by 2022.

The mission covers a range of sectors, from IT to engineering, healthcare, and construction.

The initiative focuses on industry-relevant skills, offering vocational training and certification.


b. Pradhan Mantri Kaushal Vikas Yojana (PMKVY)

PMKVY is one of the flagship schemes under the Skill India Mission. The government provides

free training in over 2000 job roles across industries. As of 2021, over 12 million youth had

been trained under this program. The scheme emphasizes practical training, certification, and

placements in key industries.


c. National Skill Development Corporation (NSDC)

The NSDC is a public-private partnership established to promote skill development by

catalyzing the creation of large-scale, high-quality vocational training. NSDC has partnered with

multiple corporations and educational institutions to ensure that graduates gain skills aligned

with industry requirements.


d. Atal Innovation Mission (AIM)

AIM is an initiative to promote innovation and entrepreneurship across schools and universities.

It aims to foster an environment of innovation labs and research centers in educational

institutions, giving students hands-on experience with emerging technologies like AI and

robotics.


3. Corporate Sector’s Role in Skilling the Workforce

The private sector plays a crucial role in addressing the skills gap. Several corporations are

stepping in to train, reskill, and upskill graduates and professionals. Many are partnering with

educational institutions, launching training programs, or setting up their own academies.


a. Tata Consultancy Services (TCS)

TCS, one of India’s largest IT companies, has been at the forefront of corporate-led skill

development. Through its Ignite program, TCS offers training in AI, machine learning, cloud

computing, and big data analytics. TCS is also working closely with universities to ensure that

curricula are aligned with industry needs.

● Listed on: BSE, NSE

● Beneficiary: TCS benefits from a steady supply of highly skilled talent, especially in

emerging tech areas like AI and data science.


b. Infosys and Infosys Springboard

Infosys has been active in providing skill development programs through its Infosys

Springboard platform, which offers free digital training courses in AI, data science,

blockchain, and cybersecurity. Infosys also runs Infosys Wingspan, a learning platform

focused on building next-gen skills for professionals.

● Listed on: BSE, NSE

● Beneficiary: Infosys benefits from training its talent pool, enabling it to offer cutting-edge

tech solutions globally.


c. Wipro

Wipro, through its TalentNext initiative, partners with universities to offer training modules

focused on AI, deep tech, and advanced software development. Wipro also works on

leadership development through Wipro Digital Academy, which focuses on skills that drive

digital transformation.

● Listed on: BSE, NSE

● Beneficiary: Wipro ensures that its employees are at the forefront of technological

innovation through continuous learning and skill enhancement.


d. Larsen & Toubro (L&T)

In the engineering and construction sectors, L&T offers various skill development programs

through its L&T Construction Skill Training Institute. The company focuses on upskilling

workers in infrastructure development, mechanical engineering, and project management.

● Listed on: BSE, NSE

● Beneficiary: L&T benefits by having a trained workforce to deliver large-scale

infrastructure and engineering projects, vital for India’s development.


e. Tata Elxsi

A leader in AI, robotics, and embedded systems, Tata Elxsi is helping bridge the skills gap by

training professionals in advanced VLSI design, AI applications, and deep tech solutions for

industries like automotive, healthcare, and media.

● Listed on: BSE, NSE

● Beneficiary: Tata Elxsi stands to gain from the growing demand for high-tech

professionals, particularly in the areas of AI and IoT.


f. NIIT Technologies

NIIT is a leading global talent development corporation, offering training in cloud computing,

data analytics, and AI. The company partners with enterprises and academic institutions to

provide job-ready skills to thousands of young professionals.

● Listed on: BSE, NSE

● Beneficiary: NIIT directly benefits by reskilling individuals, especially in the fields of IT

and deep tech.


g. Tech Mahindra

Tech Mahindra has introduced its #NexTechGirl program aimed at closing the gender gap in

tech and ensuring women are trained in AI, blockchain, and cybersecurity. The company is

also a key player in AI and deep tech training through its partnerships with global universities.

● Listed on: BSE, NSE

● Beneficiary: Tech Mahindra’s investment in AI skills positions the company as a leader

in next-gen tech services.


4. Investment Opportunities: Benefiting from the Skilling Revolution

As India focuses on skilling its youth, certain companies will emerge as beneficiaries of this

talent transformation. Here are some of the best-listed companies on BSE or NSE that will

benefit from India’s upskilling push:


● Tata Consultancy Services (TCS): As the largest IT service company in India, TCS will

directly benefit from the skilled workforce needed to drive innovation in AI, deep tech,

and cloud computing.


● Infosys: Infosys will gain from having a constant pipeline of skilled professionals,

ensuring it stays competitive in AI, data science, and blockchain projects.


● Wipro: With its investments in AI, blockchain, and deep tech training, Wipro will continue

to be a key player in India’s IT sector.


● L&T: As infrastructure projects grow, L&T will need a skilled workforce in mechanical

and civil engineering, project management, and advanced manufacturing.


● NIIT Technologies: As a major player in training and reskilling, NIIT stands to grow from

the rising demand for qualified professionals in deep tech and AI sectors.


● Tata Elxsi: With its focus on AI and robotics, Tata Elxsi will benefit from skilling in

next-gen technologies, especially in autonomous systems, media tech, and healthcare.


Conclusion: Building India’s Future Workforce

India’s skills gap presents a significant challenge, but it is also an opportunity for growth.

Through government initiatives and corporate partnerships, India is equipping its youth with the

skills needed for AI, deep tech, data science, and other emerging industries. As the workforce

becomes more skilled, India will position itself as a global leader in technology and innovation.

Investors looking for opportunities should keep an eye on companies that are at the forefront of

this skilling revolution. These companies are not just investing in human capital; they are

setting the foundation for long-term growth and dominance in high-tech industries. As India’s

talent pool strengthens, these firms will reap the benefits in the global marketplace 

Closing the Skill Gap in India: How the Government and Corporate Sector Are Empowering the Workforce
Ishan Tiwari September 19, 2024
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