India’s Industrial Training Institutes (ITIs) are set to play a larger role in preparing young people for changing workforce requirements. Launched on 4 October 2025, the Pradhan Mantri Skilling and Employability Transformation through Upgraded ITIs (PM-SETU) scheme aims to modernise government ITIs, strengthen industry participation and make vocational training more relevant to emerging occupations.
With a total outlay of ₹60,000 crore, PM-SETU brings together the Central and State Governments and industry to improve training infrastructure, introduce industry-aligned courses and strengthen the link between skills and employment. As the scheme completes its first year in October 2026, implementation has progressed from institutional preparation and ITI identification to cluster approvals, investment plans and the involvement of industry partners.
The first year provides an opportunity to examine how the scheme is being implemented, what its institutional framework looks like and how it could influence India’s vocational training ecosystem.
PM-SETU: An Overview of the Scheme
PM-SETU addresses the need to improve the quality, relevance and industry orientation of vocational training. ITIs provide practical training in engineering and non-engineering trades, but their ability to respond to changing technologies and industrial requirements depends on the availability of modern equipment, relevant curricula and strong employer linkages.
The scheme has a total financial outlay of ₹60,000 crore, shared across three contributors:
- Central Government: ₹30,000 crore
- State Governments: ₹20,000 crore
- Industry: ₹10,000 crore
The five-year implementation framework focuses on upgrading 1,000 government ITIs and strengthening five National Skill Training Institutes (NSTIs). It also places industry partners within the institutional and operational structure of the upgraded ITIs.
The scheme has two major components:
- Upgradation of 1,000 Government ITIs
The first component covers 200 Hub ITIs and 800 Spoke ITIs. The proposed improvements include smart classrooms, modern laboratories, digital learning content, upgraded equipment and courses aligned with industry requirements.
- Capacity augmentation of five NSTIs
The second component focuses on NSTIs in Bhubaneswar, Chennai, Hyderabad, Kanpur and Ludhiana. It includes sector-specific National Centres of Excellence for Skilling, advanced training for trainers and international partnerships to strengthen training capacity.
Together, these components seek to improve both the infrastructure used to train learners and the institutional capacity required to deliver relevant vocational education.
How the Hub-and-Spoke Model Will Work
A key feature of PM-SETU is its Hub-and-Spoke model, which connects selected ITIs into clusters rather than treating each institute as an independent unit.
Under this structure, 200 Hub ITIs will be supported by a network of 800 Spoke ITIs. Each Hub is connected to an average of four Spoke ITIs, creating opportunities to share infrastructure, training resources and industry connections.
Hub ITIs are expected to provide advanced facilities such as innovation centres, training-of-trainers infrastructure, production units and placement services. Spoke ITIs will extend access to training and connect learners with the resources available across their clusters.
The model is intended to make better use of investments and expand access to modern training facilities. It also creates a framework through which industry partners can support several institutes within a region.
PM-SETU at One Year: Progress in Implementation
The first year has seen progress in identifying institutions, setting up state-level implementation mechanisms and approving investment plans for ITI clusters.
According to the Ministry of Skill Development and Entrepreneurship’s October 2026 overview, the scheme has recorded the following developments:
- 850 ITIs identified: The identified institutions comprise 172 Hub ITIs and 678 Spoke ITIs.
- Implementation mechanisms established: All 36 States and Union Territories have identified clusters and created dedicated budget heads for the scheme.
- State-level oversight: 35 States and Union Territories have constituted State Steering Committees.
- Industry participation initiated: 26 States and Union Territories have begun the process of inviting industry participation.
- Nationwide rollout approved: The National Steering Committee has approved the transition from the pilot phase to a nationwide rollout across all 200 identified ITI clusters.
- Investment plans approved: Strategic Investment Plans (SIPs) for 14 ITI clusters, involving a total investment of ₹3,446 crore, have received approval.
These developments indicate that PM-SETU has moved beyond its initial planning stage. However, identifying institutes and approving investment plans are early steps in a longer implementation process. The impact will depend on how effectively infrastructure upgrades, curriculum changes and industry partnerships translate into improved training and employment opportunities.
Industry Partnerships at the Centre of ITI Transformation
PM-SETU gives industry partners a formal role in planning and managing the transformation of ITI clusters. This is intended to bring training closer to actual workplace requirements and encourage employers to contribute to curriculum development, infrastructure modernisation, training delivery and industry exposure.
The scheme provides for the creation of Special Purpose Vehicles (SPVs) to govern upgraded ITI clusters. Under the proposed ownership structure, the Anchor Industry Partner holds 51% ownership, while the Central and State Governments hold 24.5% each.
Anchor Industry Partners are expected to submit Strategic Investment Plans outlining the proposed investments and interventions for their respective clusters. These plans are reviewed through the state-level and national implementation mechanisms.
The involvement of industry is significant because employers can help identify the skills required in their sectors, introduce relevant technologies and provide learners with greater exposure to industrial practices. The model also creates opportunities to strengthen apprenticeships, workplace learning and placement linkages.
Examples of Industry Participation Under PM-SETU
Several approved clusters illustrate how the scheme is bringing different industries into the vocational training ecosystem.
- Odisha: Jindal Naveen Avsar Limited has been selected as the Anchor Industry Partner for the Keonjhar-Barbil cluster, with a proposed investment of approximately ₹240 crore.
- Gujarat: ArcelorMittal Nippon Steel India is anchoring the Surat ITI cluster, with a proposed investment of approximately ₹240 crore.
- Telangana: Three clusters at Old City, Sangareddy and Patancheru have received approval, with partners including Apollo MedSkills, Neuland Foundation and Sri Siddharth Infratech & Services.
- Rajasthan: H.G. Infra Engineering Limited has been selected for the Bhiwadi ITI cluster, with a proposed investment of approximately ₹241 crore. The signing of a Shareholders’ Agreement marked the formal commencement of implementation activities for this cluster.
- Andhra Pradesh: The National Steering Committee (NSC) has approved the Strategic Investment Plan (SIP) for the Visakhapatnam ITI Cluster in Andhra Pradesh. The proposal was submitted by ArcelorMittal Nippon Steel India (AM/NS India) along with its academic partner, New Age Makers Institute of Technology (NAMTECH). Click here to read more!
These examples demonstrate the range of sectors participating in the scheme, including steel and metals, healthcare, pharmaceuticals, manufacturing and infrastructure.
In July 2026, the National Steering Committee approved the transition to nationwide implementation across the 200 identified clusters and cleared Strategic Investment Plans worth ₹1,237.58 crore for selected clusters in Odisha, Gujarat and Telangana. In September 2026, further approvals worth ₹735.70 crore were announced for clusters in Rajasthan, Uttar Pradesh and Telangana.
The subsequent October 2026 overview reports approvals for 14 clusters with a combined investment of ₹3,446 crore, reflecting the scheme’s progress over the first year.
Introducing New-Age Courses for Emerging Industries
Modernising training infrastructure is only one part of the transformation. Vocational training must also respond to technological developments and changing occupational requirements.
The Directorate General of Training (DGT) has introduced 32 new-age courses under the Craftsmen Training Scheme. These cover emerging technologies and occupations, including:
- Artificial Intelligence and Cyber Security
- Semiconductor Technology and Robotics
- Electric Vehicles and Additive Manufacturing
- Drones and the Internet of Things (IoT)
- Green Hydrogen and Solar Energy
- 5G Network Technology and Software Testing
States can adopt these courses in their ITIs, which remain under the administrative and financial control of State Governments and Union Territory Administrations.
The introduction of these courses creates opportunities to broaden the scope of vocational training beyond traditional trades. It also highlights the importance of equipping trainers with the knowledge and practical experience needed to teach emerging technologies.
For the scheme to achieve its intended outcomes, course adoption will need to be accompanied by appropriate equipment, qualified trainers, practical learning opportunities and regular engagement with employers.
International Partnerships to Strengthen Training Capacity
PM-SETU also includes international collaboration to strengthen advanced training and the capacity of National Centres of Excellence for Skilling.
Partnerships have been established with several countries:
- Singapore: Memorandum of Understanding for NSTI Chennai.
- France: Memorandum of Understanding for NSTI Kanpur.
- Australia: Memorandum of Understanding for NSTI Bhubaneswar.
- Germany: Joint Declaration of Intent exchanged for NSTI Hyderabad.
These partnerships are intended to support advanced training for trainers, curriculum development and alignment with global standards. They also provide a framework for bringing international expertise into India’s vocational training institutions.
Strengthening trainer capacity is particularly important as ITIs introduce new technologies and courses. Modern equipment alone cannot ensure quality training; instructors must also be prepared to use it effectively and connect technical knowledge with practical workplace applications.
Why ITI Modernisation Matters for India’s Workforce
The scale of India’s ITI network provides an important foundation for the scheme. According to the October 2026 PIB overview, the total number of government and private ITIs increased from 9,776 in 2014 to 13,888 in 2026, a rise of approximately 42%.
Enrolment also increased from 9.51 lakh in the 2014–15 academic session to 14.70 lakh in 2025–26, representing an increase of approximately 54%.
As more learners enter vocational training, the relevance and quality of the training they receive become increasingly important. Employers need workers who can operate modern machinery, adapt to new technologies and apply their knowledge in real workplace settings.
PM-SETU seeks to address these requirements by combining infrastructure upgrades with industry participation and new-age courses. Its cluster-based approach may also help extend access to advanced training resources beyond individual institutions.
However, improved employability will depend on more than the number of institutes upgraded or the value of investments approved. Training quality, course completion, apprenticeships, employer participation and the availability of suitable jobs will also shape the outcomes for learners.
What needs to happen next?
The first year has established an implementation framework for PM-SETU, but the next phase will be important in determining how the scheme translates into changes at the institute level.
Some key areas to watch include:
- Completing ITI identification: The October 2026 overview identifies 850 ITIs, while the scheme aims to cover 1,000 government ITIs.
- Moving from approvals to implementation: Strategic Investment Plans must translate into upgraded facilities, functioning laboratories, relevant courses and effective training delivery.
- Deepening industry engagement: Employers need to contribute consistently to curriculum design, practical training, apprenticeships and placement opportunities.
- Strengthening trainers: New equipment and courses must be supported by instructors with relevant technical and pedagogical capabilities.
- Tracking outcomes: Monitoring should extend beyond infrastructure and expenditure to include learner participation, course completion, certification, apprenticeships and employment outcomes.
These priorities will be central to ensuring that the scheme’s investments lead to sustainable improvements in vocational training.
Looking ahead
One year after its launch, the scheme has established a framework for transforming government ITIs through modern infrastructure, industry-led governance, new-age courses and international collaboration. The identification of 850 ITIs, the establishment of state-level implementation mechanisms and the approval of investment plans for 14 clusters mark important steps in the scheme’s rollout.
The next stage will require sustained coordination among the Central Government, State Governments, industry partners and training institutions. The effectiveness of the scheme will ultimately be reflected in the quality of training that learners receive and their ability to apply their skills in the workplace.
As India responds to changes in manufacturing, digital technologies, infrastructure and emerging industries, the modernisation of ITIs will remain an important part of building a workforce equipped for evolving employment requirements. PM-SETU provides a framework for this transformation; its longer-term significance will depend on how effectively that framework is implemented across the country.
