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PM-SETU: AM/NS India pacts to upgrade nine ITIs in Surat, Visakhapatnam

By CAShorts DeskPublished Source: PIB (Ministry of Skill Development and Entrepreneurship), Hindustan Times, PMIndia

PM-SETU: AM/NS India pacts to upgrade nine ITIs in Surat, Visakhapatnam
Illustration (AI-generated)

The Ministry of Skill Development and Entrepreneurship, the Gujarat and Andhra Pradesh governments and AM/NS India signed shareholders' agreements on October 12, 2026 to upgrade nine government ITIs under the PM-SETU scheme. Five ITIs in Surat get ₹240 crore and four in Visakhapatnam ₹200 crore. Special purpose vehicles will run each cluster, with AM/NS India holding 51%.

Syllabus: GS3 · Indian Economy & Growth; GS2 · Government Policies; GS2 · Health, Education & Human Resources

Why this matters for UPSC

GS2 (welfare schemes, human resources) and GS3 (employment): Prelims can ask PM-SETU's ministry, funding shares, co-financiers and SPV model; Mains, whether industry-managed ITIs can fix India's skills gap.

Why it matters

A student in a government ITI in Bobbili or Surat often trains on old machines in trades employers no longer need, and then struggles to find a job. Under these agreements a steelmaker helps choose the trades, equip the workshops and train the instructors, so the course matches what factories actually hire for. If it works, local firms, including MSMEs, get workers ready on day one, and young people get a better chance at a factory job instead of a certificate that counts for little. The larger question is whether giving industry a controlling stake in public training institutes can make vocational education attractive again, without losing its public character.

Prelims pointers

  • PM-SETU: Centrally Sponsored Scheme of the Ministry of Skill Development and Entrepreneurship, announced in Union Budgets 2024-25 and 2025-26.
  • Funding: ₹60,000 crore outlay; Asian Development Bank and World Bank equally co-finance 50% of the ₹30,000 crore central share.
  • Model: industry-led Special Purpose Vehicle; ITIs become government-owned, industry-managed aspirational institutes in hub-and-spoke clusters.
  • Five NSTIs under the scheme: Bhubaneswar, Chennai, Hyderabad, Kanpur and Ludhiana; each gets a National Centre of Excellence for Skilling.
  • Directorate General of Training (DGT): the MSDE arm that oversees the national ITI and NSTI training system.
  • ITIs run under State Governments; the national network stood at 14,615 ITIs with 14.40 lakh enrolment, per the Union Cabinet's release on the scheme.
  • Centrally Sponsored Scheme: implemented by States with shared funding; Central Sector Scheme: fully Union-funded and run by central agencies.

Practise a UPSC-style question

With reference to the Pradhan Mantri Skilling and Employability Transformation through Upgraded ITIs (PM-SETU) scheme, consider the following statements:

1. It is a Central Sector Scheme funded entirely by the Union government.

2. The Asian Development Bank and the World Bank equally co-finance half of its central share.

3. It aims to upgrade 1,000 government ITIs in a hub-and-spoke arrangement.

Which of the statements given above is/are correct?

  1. (a) 1 and 2 only
  2. (b) 2 and 3 only
  3. (c) 1 and 3 only
  4. (d) 1, 2 and 3
Show the answer

Answer: (b) 2 and 3 only

1 is incorrect: PM-SETU is a Centrally Sponsored Scheme, with a Central share of ₹30,000 crore, a State share of ₹20,000 crore and an industry share of ₹10,000 crore. 2 is correct: the Asian Development Bank and the World Bank co-finance 50% of the central share, in equal parts. 3 is correct: 1,000 government ITIs are to be upgraded in hub-and-spoke clusters with revamped trades.

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