NITI Aayog Releases Report on Apprenticeship in India

Apprenticeships: The Missing Link in India’s Skilling Strategy

India’s apprenticeship system is losing steam. In 2024-25, only 985,000 individuals out of 1.31 million registered apprentices actually engaged, and a mere 251,000 completed their training. At a time when the country boasts one of the largest youth populations globally—345 million in 2036 projected—these numbers are nothing short of alarming. The NITI Aayog’s report, “Revitalizing Apprenticeship Ecosystem,” released on February 21, 2026, attempts to tackle these glaring gaps, but its recommendations face structural challenges that remain underexplored.

The Policy Framework: Lofty Goals with Limited Backing

The report envisions an apprenticeship ecosystem as the backbone of India’s skilling and employment strategy. It advocates for a National Apprenticeship Mission and a unified National Apprenticeship Portal to address governance inefficiencies. Recommendations include policy incentives to encourage engagement in the underserved North-East, aspirational districts, and among women and marginalised groups.

Importantly, NITI Aayog suggests introducing an Apprenticeship Engagement Index to benchmark state and Union Territory performance, along with district-level interventions such as recognising the top 25 districts with the highest growth in apprenticeships. Efforts have also been proposed to integrate MSMEs, the informal sector, and even start-ups into the fold, with a focus on aligning apprenticeship programmes with emerging opportunities in the gig and platform economy—a forward-looking yet complex ambition.

Though the report bolsters existing schemes like the National Apprenticeship Promotion Scheme (NAPS) introduced in 2016 and the National Apprenticeship Training Scheme (NATS), evidence suggests that fiscal and institutional constraints continue to hamstring both programmes. For instance, NAPS reimburses up to ₹1,500 of apprentice stipends and basic training costs, but its outreach to outlier geographies and smaller enterprises has been notably patchy.

The Case for Scaling Apprenticeships

The demographic dividend numbers are glaring. By 2036, 27.2% of India’s population will remain in the working-age bracket of 15–29 years. Apprenticeships, as a bridge between education and employment, especially in a rapidly evolving labour market, promise significant benefits. Studies have consistently found that youth trained through work-based learning are better equipped to transition into formal jobs, enhancing workforce productivity and reducing underemployment.

Large enterprises, by engaging over 70% of apprentices despite accounting for less than 30% of active establishments, demonstrate the relevance of structured on-the-job training in meeting skill gaps. Global evidence supports this: Germany, among the most successful apprenticeship models globally, incorporates nearly 50% of its youth into vocational apprenticeship tracks. Unlike India’s fragmented system, Germany mandates a strong collaboration between its Federal Ministry of Education and Research, industry stakeholders, and state governments under its Duale Ausbildungssystem. This integrated governance ensures standardised training, eases regulatory bottlenecks, and directly feeds into the labour market requirements of companies in secondary and tertiary sectors.

The NITI Aayog’s recommendations echo elements of this, especially the call for greater participation by MSMEs through clusters and targeted support for aspirational districts. Additionally, the inclusion of travel and accommodation stipends, as well as insurance coverage for marginalised apprentices, offers a safety net in a fragmented labour market.

The Structural Constraints

Despite these ambitions, the gap between policy intent and execution remains vast. The most glaring issue is the disconnect with smaller enterprises. MSMEs, although formally registered in significant numbers, are scarcely incentivised to participate due to compliance burdens and limited administrative capacity. Cluster-based facilitation, as recommended, may mitigate this to some extent, but whether MSMEs have adequate support remains to be seen.

The gender gap is another pressing concern. Male apprentices dominate registrations and completions year after year, despite women comprising nearly 48% of the country’s population. Policies for “targeted incentives” feel inadequate in the face of entrenched structural barriers, including workplace safety concerns and compensation inequities.

Moreover, regional disparities, where the top 10 states account for over 80% of engagement, mirror broader governance inequities in India’s federal system. The politically marginalised North-East, with its persistent infrastructure deficits, offers only negligible contributions to apprenticeship participation. While reforms aim to expand outreach, funding allocations and administrative priorities often remain skewed in favour of industrially stronger regions.

Lastly, the dropout rate—nearly 25% of registered apprentices fail to complete training—reveals another blind spot. This could indicate mismatches between industry requirements and apprentice skills, calling for deeper alignment of training curriculums to workplace realities.

International Lessons: Germany’s Rigour vs. India’s Fragmentation

Germany’s apprenticeship model thrives on structural precision. By aligning vocational education with market needs through federal oversight and funding, Germany has achieved an apprenticeship completion rate of over 80%. In contrast, India operates in silos. NAPS falls within the Ministry of Skill Development, while NATS is under the Ministry of Education, resulting in duplication and a lack of cohesive oversight.

Additionally, Germany’s industry-trade cooperation secures shared funding, while India’s reliance on isolated government incentives for stipends creates inadequate buy-in from private players. NITI Aayog’s call to unify efforts under a National Apprenticeship Portal could theoretically address this fragmentation—if it is accompanied by tighter enforcement and realistic budget allocations.

Concluding Appraisal: Overcoming Fragmentation is Key

The NITI Aayog initiative brings necessary attention to the apprenticeship gap, but its success hinges on implementation. While the report makes well-meaning recommendations, the absence of prescribed accountability measures for state and district actors weakens its potential impact. The emphasis on integrating the gig economy and enabling greater MSME participation, though ambitious, risks being undermined by uneven capacity-building efforts.

Ultimately, India must prioritise addressing its structural constraints. Without direct funding boosts, streamlined governance, and industry collaboration on the lines of Germany, the demographic dividend may turn into a demographic liability. Amendments to apprenticeship schemes should—at a minimum—achieve higher completion rates to realise any tangible returns on investment.

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