Sarkari Yojana
Pradhan Mantri Skilling and Employability Transformation through Upgraded ITIs (PM‑SETU) : Component I
About Pradhan Mantri Skilling and Employability Transformation through Upgraded ITIs (PM‑SETU) : Component I
Launched by the Ministry of Skill Development and Entrepreneurship (MSDE), Government of India, Pradhan Mantri Skilling and Employability Transformation (PM SETU) Component I: Upgradation of Industrial Training Institutes sets out to turn Industrial Training Institutes (ITIs) into industry-aligned, state-of-the-art skilling institutions capable of producing highly employable youth. Students, trainees, and workforce participants benefit from large-scale infrastructure upgrades, industry-led course design, and stronger training and placement services delivered under the scheme. The Directorate General of Training (DGT) implements it alongside State Governments and industry partners, working through a Special Purpose Vehicle (SPV) framework. > Objectives: The scheme sets out to reimagine and upgrade ITIs, bringing in industry-led governance to create state-of-the-art skilling institutions producing youth who meet industry needs. Its salient features include:
1. One thousand (1,000) Government ITIs — 200 as hub ITIs and 800 as spoke ITIs — are to be upgraded in a Hub-and-Spoke arrangement, with each Hub ITI overseeing an average of four (4) Spoke ITIs and every upgraded ITI equipped with state-of-the-art infrastructure, machinery, and equipment. 1. Upgrading ITIs in Hub-and-Spoke arrangements involves setting up a Special Purpose Vehicle (SPV) that brings in a credible Anchor Industry Partner (AIP), along with other industry partners where needed, to manage the Hub-and-Spoke cluster(s) and deliver the agreed outcome-based training and employment results. 1. New courses are introduced based on the jobs, occupations, and competencies required in the identified sector/industry segment, with flexibility built into their duration and pedagogy. 1. Existing courses are redesigned to match industry needs and improve employability, with high-demand traditional courses revamped through upgraded curricula and modern technology. 1. Hub ITIs will, on average, introduce four (4) new courses and upgrade ten (10) existing ones; Spoke ITIs will, on average, introduce two (2) new courses and upgrade eight (8) existing ones. 1. There is flexibility to introduce service-sector courses, multi-skilled courses, and livelihood-promotion courses in areas where industry presence is low. 1. Besides the National Trade Certificate (NTC), the current certification for ITI pass-outs, options may extend to long-term courses (Diplomas), short-term courses (3-6 months), and Executive Education Programs for graduates and working professionals, drawing on the advanced machinery, equipment, and trainers present at Hub ITIs. 1. Specialised short-term courses are offered to both ITI and non-ITI candidates (Engineering, Diploma holders, and working professionals). 1. A Training of Trainers (ToT) facility is available at the Hub ITI. 1. Student services are strengthened across the Hub-and-Spoke cluster, covering placement services and industry linkages, counselling, remedial classes to close gaps in foundational learning, extra-curricular activities, life skills training, apprenticeships, and On-the-Job training, among others. 1. Hubs may run services such as production centres, incubation centres, and maker spaces, charging fees the ITI itself sets to stay financially sustainable. 1. A digital interface and Learning Outcome Management System (LOMS) will be built to map the entire Hub-and-Spoke ITI network, capture data in real time, provide digital learning avenues including artificial and virtual reality (AR/VR) capabilities and simulation, and link with national datasets and the Skill India Digital Hub (SIDH). 1. A human resource plan will guide implementation of the upgradation across both Hub and Spoke ITIs, covering a managerial layer, trainers, administrative staff, and better HR practices to improve training outcomes. 1. Mini-Hubs for the North-East and Hilly region: to enable Hub-and-Spoke ITI upgradation in North-Eastern and Hilly States, the indicative definitions of Hubs and Spokes may be relaxed.
Scheme Overview
Central Government
Ministry Of Skill Development And Entrepreneurship
Scheme Details
Eligibility Requirements
To qualify for Pradhan Mantri Skilling and Employability Transformation through Upgraded ITIs (PM‑SETU) : Component I , applicants must satisfy the following conditions:
For Government ITIs:
The institutes must be Government Industrial Training Institutes
The institutes must be Government Industrial Training Institutes.
The respective State or Union Territory carries out…
The respective State or Union Territory carries out the selection of ITIs.
Selection factors include emerging skill requirements, local industry…
Selection factors include emerging skill requirements, local industry demand, and the potential for industry participation. For Anchor Industry Partner (AIP) / Industry Partner:
The applicant must be a credible company or…
The applicant must be a credible company or manufacturer with established operations in India.
The applicant could be an industry association, consortium,…
The applicant could be an industry association, consortium, industry-led foundation, or an academic institution backed by industry.
The applicant must be capable of taking part…
The applicant must be capable of taking part in governance, curriculum design, and training delivery. Minimum Eligibility Conditions (As Defined by State/UT):
The applicant must satisfy minimum eligibility criteria —…
The applicant must satisfy minimum eligibility criteria — turnover, employee count, and sectoral experience — as set by the State or Union Territory.
The applicant must be able to demonstrate meaningful…
The applicant must be able to demonstrate meaningful industry participation.
The applicant must not be a small or…
The applicant must not be a small or non-serious operator.
Benefits Provided
Pradhan Mantri Skilling and Employability Transformation through Upgraded ITIs (PM‑SETU) : Component I provides the following benefits to eligible applicants:
Financial Outlay and Financing Structure: Over five years, the scheme carries a total outlay of ₹60,000/- crore, split between the Central Government, State Governments, and Industry as follows: ParticularsTotal (₹ Crore)Central (₹ Crore)State (₹ Crore)Industry (₹ Crore)Total Scheme Outlay (5 years)60,000/-30,000/-20,000/-10,000/-This works out to a funding pattern of roughly 50% Central : 33% State : 17% Industry, and every Hub-and-Spoke cluster keeps this same cost-sharing ratio in its funding plan, as set out in its Strategic Investment Plan (SIP). Indicative Investment per ITI and Cluster:
The scheme supports Hub ITI upgradation with an…
The scheme supports Hub ITI upgradation with an outlay capped at ₹81 crore over five years, and Spoke ITI upgradation capped at ₹40 crore.
Where the total upgradation cost runs higher than…
Where the total upgradation cost runs higher than this prescribed outlay, the Central Government's share is capped at 50% of the above ceilings and restricted strictly to capital expenditure (with exceptions for North-Eastern and Hilly States and Union Territories without a legislature). Indicative Cost for Cluster:
One Hub + Four Spokes (cluster total)
One Hub + Four Spokes (cluster total): ₹241 crore per cluster
Annual cost for one cluster (5-year average)
Annual cost for one cluster (5-year average): ~₹48.2 crore per year Component-wise Outlay (1000 ITIs):
Upgrading 200 Hub ITIs
Upgrading 200 Hub ITIs: ₹20,220 crore
Upgrading 800 Spoke ITIs
Upgrading 800 Spoke ITIs: ₹36,680 crore
Subtotal – ITI Upgradation (Component I)
Subtotal – ITI Upgradation (Component I): ₹56,900 crore Central Support for Scheme Management:
Over five years, ₹1,600 crore is set aside…
Over five years, ₹1,600 crore is set aside for governance, project management, and capacity-building, broken down as:
Capacity building of central and state agencies
Capacity building of central and state agencies: ₹200 crore
Office expenditure
Office expenditure: ₹100 crore
IT and digital infrastructure (including LOMS)
IT and digital infrastructure (including LOMS): ₹600 crore
Technical assistance
Technical assistance: ₹100 crore
Media, awareness, and advocacy
Media, awareness, and advocacy: ₹100 crore
Evaluations, studies, and research
Evaluations, studies, and research: ₹100 crore
Project Management Unit (PMU) support
Project Management Unit (PMU) support: ₹400 crore Fund Flow Mechanism:
Every approved cluster SPV operates an escrow bank…
Every approved cluster SPV operates an escrow bank account into which Central, State, and Industry contributions are all deposited; funds become available only once all three parties have paid in their respective shares. Fund Disbursement:
Initial Advance (Year 1)
Initial Advance (Year 1):
Once the Strategic Investment Plan (SIP) is approved,…
Once the Strategic Investment Plan (SIP) is approved, an advance of up to 10% of the total project outlay is released.
Annual Instalments (Years 2–5)
Annual Instalments (Years 2–5):
The remaining funds follow in annual instalments split…
The remaining funds follow in annual instalments split into two tranches of 50% each, conditional on:
At least 75% of the previous funds having…
At least 75% of the previous funds having been utilised
The Annual Operational Plan (AOP) being approved
The Annual Operational Plan (AOP) being approved
At least 80% of the Key Performance Indicators…
At least 80% of the Key Performance Indicators (KPIs) being achieved Validity: The scheme runs for a period of five years.
Documents Required
Applicants should keep the following documents ready before starting the application:
The Expression of Interest (EOI) document
The Expression of Interest (EOI) document
The Request for Proposal (RFP) response
The Request for Proposal (RFP) response
A Strategic Investment Plan (SIP), completed on the…
A Strategic Investment Plan (SIP), completed on the prescribed template
Company Registration/Incorporation documents (for the industry partner)
Company Registration/Incorporation documents (for the industry partner)
Financial statements evidencing turnover, per State criteria
Financial statements evidencing turnover, per State criteria
Documentation of the number of employees
Documentation of the number of employees
A Debarment Declaration Certificate, confirming no debarment by…
A Debarment Declaration Certificate, confirming no debarment by any government agency
Commitment letters from the State Government covering staffing,…
Commitment letters from the State Government covering staffing, scheme funding, and regulatory reforms
Letters of collaboration from partner industries, where applicable
Letters of collaboration from partner industries, where applicable
A Baseline Characteristics Document for Hub and Spoke…
A Baseline Characteristics Document for Hub and Spoke ITIs (Template 1)
Budget allocation documents for the last three financial…
Budget allocation documents for the last three financial years (Template 2)
A Five-Year Investment Plan Budget (Template 3)
A Five-Year Investment Plan Budget (Template 3)
Performance Indicators documentation (Template 4)
Performance Indicators documentation (Template 4)
An Implementation Gantt Chart (Template 5)
An Implementation Gantt Chart (Template 5)
MoUs with industries covering employment, apprenticeships, and funding,…
MoUs with industries covering employment, apprenticeships, and funding, where applicable
An HR Plan document, including managerial capacity details
An HR Plan document, including managerial capacity details
Credentials of the proposed SPV CEO and management
Credentials of the proposed SPV CEO and management
A Shareholders' Agreement (SHA)
A Shareholders' Agreement (SHA)
A License Agreement (LA)
A License Agreement (LA)
Performance Security, in the form of a Bank…
Performance Security, in the form of a Bank Guarantee from a Scheduled Bank
An Annual Operational Plan (AOP)
An Annual Operational Plan (AOP)
An Asset Register
An Asset Register
Utilisation Certificates certified by a Chartered Accountant Note
Utilisation Certificates certified by a Chartered Accountant Note: Click Here For Template )
How to Apply
Offline Application
Applicants can apply for Pradhan Mantri Skilling and Employability Transformation through Upgraded ITIs (PM‑SETU) : Component I through the offline application process outlined below.
The State or Union Territory identifies which Government…
The State or Union Territory identifies which Government Industrial Training Institutes (ITIs) need upgradation and draws up the Request for Proposal (RFP) along with the eligibility criteria.
The State or Union Territory then issues this…
The State or Union Territory then issues this RFP, inviting proposals from eligible Anchor Industry Partners (AIP) or other industry partners.
The applicant submits its proposal together with a…
The applicant submits its proposal together with a Strategic Investment Plan (SIP) covering infrastructure, courses, human resources, financials, and the implementation strategy.
Submitted proposals go through pre-qualification, technical assessment of…
Submitted proposals go through pre-qualification, technical assessment of the SIP, and financial evaluation.
The State Government picks the suitable proposals and…
The State Government picks the suitable proposals and forwards them to the National Steering Committee (NSC) for final approval.
Once approved, a Special Purpose Vehicle (SPV) is…
Once approved, a Special Purpose Vehicle (SPV) is set up for each cluster, and agreements such as the Shareholder Agreement (SHA) and License Agreement (LA) get executed.
The SPV opens an escrow account, into which…
The SPV opens an escrow account, into which the Central Government, State Government, and Industry deposit their respective contributions.
The SPV then prepares its Annual Operational Plan…
The SPV then prepares its Annual Operational Plan (AOP), aligned with the approved Strategic Investment Plan (SIP).
Funds get released in stages — an initial…
Funds get released in stages — an initial advance first, followed by further instalments tied to fund utilisation, performance, and AOP approval.
The SPV carries out the ITI upgradation itself,…
The SPV carries out the ITI upgradation itself, covering infrastructure development, course delivery, and the provision of training and student services.
Objectives
****** The scheme’s objective is to upgrade and reimagine ITIs through industryled governance into state-of-the-art skilling institutions that produce highly employable youth aligned with industry needs. The salient features include:
Official Application & Website
Verify the latest eligibility, dates and instructions before applying.