Sitharaman said India’s industry is moving rapidly toward digital and AI-driven operations but continues to face a shortage of skilled workers.
18 Sep 2025 | 3285 Views | By Yukta Mudgal
Finance Minister Nirmala Sitharaman on Thursday announced that one industrial training institute (ITI) in every district will be upgraded into an AI-based training hub under a hub-and-spoke model, to strengthen skills and tap India’s demographic dividend.
The minister, speaking at the International Forum for Quality Management (IFQM) ...
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Finance Minister Nirmala Sitharaman on Thursday announced that one industrial training institute (ITI) in every district will be upgraded into an AI-based training hub under a hub-and-spoke model, to strengthen skills and tap India’s demographic dividend.
The minister, speaking at the International Forum for Quality Management (IFQM) Symposium addressing industry leaders across the automotive, auto-component, and aviation sectors, said the government is taking a comprehensive approach to skilling, focusing not only on traditional training but also on emerging technologies like artificial intelligence.
“We came up with an offer from the central government that every district-level ITI, around 750 across the country, adopt a hub-and-spoke model within the state. We will be able to provide them the entire money required for upgrading these places into AI-driven training centres,” Sitharaman said.
According to a PIB release, India has 14,615 ITIs, of which 3,316 are government-run and 11,299 privately managed. ITIs are funded not only by the government but also by OEMs.
In July, the Centre set up a National Steering Committee (NSC) with members from key ministries, states, and industry to frame guidelines for upgrading India’s skilling ecosystem. The move follows the Cabinet’s approval in May of a ₹60,000 crore plan to revamp 1,000 ITIs under a hub-and-spoke model and establish five National Centres of Excellence, targeting training for over two million youth. Industry players like Bajaj Auto, ITC, HAL, and Hero MotoCorp are part of the panel.
The new model is designed to align skills with industry needs, particularly in areas ranging from agriculture to automation, and to offer hands-on AI training to youth, including school dropouts and graduates.
The initiative is part of a broader push to bridge the gap between education and employability. Sitharaman said India’s industry is moving rapidly toward digital and AI-driven operations but continues to face a shortage of skilled workers.
She highlighted the skill gap in the industry and called for greater collaboration between the private sector and the government. “The degree on paper is there. But the individuals are not groomed adequately enough to be a part of the large multinationals. So I would want private sector participation together with the government, in readying youth to be fit for quick and direct employment.”
“Industry’s grievance when talking to the government has been that we are moving rapidly… but we are not able to have the right kind of people to employ,” she said. “In the last two budgets, provisions have been made so that manpower, skilling and upskilling can all happen with the investment that we can put in.”
The government is also supporting AI research and training at top institutions, including IITs and the Indian Institute of Science, beyond ITI upgrades. These centres of excellence are focusing on priority sectors such as agriculture, education, health, and urban development, with space and nuclear technology recently added to the list.