Examine how the hub-and-spoke model and equity-sharing framework of PM-SETU can address the persistent mismatch between ITI training and industry demand.

NITI Aayog found that ITIs fill only about 48% of their roughly 25 lakh seats [1]. This shows that young people and employers both see ITI training as weakly linked to jobs. PM-SETU (₹60,000 crore, 1,000 Government ITIs) [2] tackles this by changing who designs and runs the training, not merely by spending more on it.

Hub-and-spoke model: spreading industry-grade capacity

• 200 hubs linked to 800 spokes, about four spokes per hub. Costly modern equipment is shared across the cluster, not duplicated in every ITI [2].
• Hubs host innovation centres, production units, training of trainers and placement services [2]. Trainees get real shop-floor practice and a direct route to jobs.
• Spokes widen access: hub-quality curricula reach smaller towns, which narrows the regional skill gap.

Equity-sharing framework: giving industry a stake in outcomes

• SPV ownership: Anchor Industry Partner 51%, Centre and State 24.5% each [3]. The employer gets management control to match trades, syllabus and machinery to its own demand.
• Example: AM/NS India and its academic partner NAMTECH will invest about ₹440 crore in 9 ITIs in Surat and Visakhapatnam. The plan includes new-age trades and instructor capacity building [3].
• Funds are released only after the SPV is formed [4], so public money flows only once a committed partner exists.
• Equal Centre–State equity creates a three-way compact and reflects cooperative federalism in skilling.

Limitations

• Slow pipeline: only 14 Strategic Investment Plans (₹3,446 crore) were approved in the first year, against 200 clusters [5]. ITIs in districts with little industry may find no anchor partner.
• Narrow skilling: a single firm may train mainly for its own plants, which lowers the value of the skills elsewhere and weakens public accountability.
• Gaps outside the SPV: new labs cannot solve instructor shortages or weak tracking of placements [1].

Overall, the hub-and-spoke design spreads capacity across a cluster, and equity-sharing makes industry responsible for results. Together they move ITIs from supply-led to demand-led training. To protect public goals, each Shareholders' Agreement should cap fees, keep admissions open and include trades useful to other employers. A placement baseline should be recorded for every cluster, and groups of MSMEs should be allowed to anchor clusters where no large firm comes forward. With these safeguards, PM-SETU can turn ITIs into a reliable source of skilled workers, in line with Skill India and SDG target 4.4.