Gujarat Government Mandates 2% Investment in Workforce Skilling for Industrial Projects

What's Happening?

The Gujarat government is set to implement a new industrial policy requiring major industrial projects to allocate at least 2% of their total project cost towards workforce skilling initiatives. This policy, a collaboration between the Labour and Employment Department and the Industry and Mines Department, aims to prepare Gujarat's workforce for the demands of advanced and next-generation industries. With an estimated need for one crore additional skilled workers by 2030, the policy encourages industries to invest in human capital and collaborate with academic institutions for skill development. The initiative also integrates skill development investments into the broader industrial promotion framework, with a projected Rs. 50,000 crore investment in skilling over the next five years.

Why It's Important?

Gujarat's new policy is a significant step towards building a future-ready workforce, essential for maintaining the state's leadership in industrial growth. By mandating investment in skilling, the policy ensures that industries contribute to workforce development, addressing the growing demand for skilled workers in high-tech sectors. This initiative not only supports economic growth but also enhances the quality and relevance of training programs through partnerships with educational institutions. The policy could serve as a model for other industrial states, promoting sustainable development and workforce readiness across India.

What's Next?

The policy will require Memorandums of Understanding for industrial investments exceeding Rs. 1,000 crore to include provisions for training and skilling infrastructure. Corporate expenditure on in-house training may count towards CSR obligations, with a potential mandate for 10-20% of CSR funds to be earmarked for skilling initiatives. The establishment of the Gujarat Sector Skill Task Force under Kaushalya Skill University will cater to the niche requirements of high-tech industries, focusing on dynamic skill mapping and responsive skilling models.