Government moves to make sustainable education central to employment strategy

Skilling India's youth in combination with bringing changes in the educational sector so that it can meet the needs of the industry for a job creation drive were the key points of a Yuva Shakti, inspired Union Budget 2026, 27, which was presented by Finance Minister Nirmala Sitharaman on Sunday.

The government, announced Sitharaman, will support various professional institutions like the Institute of Chartered Accountants of India (ICAI), Institute of Company Secretaries of India (ICSI), and Institute of Cost and Management Accountants of India (ICMAI) to come up with short, term, modular courses and practical tools that will help create a group of "Corporate Mitras", mainly in Tier, II and Tier, III towns. These "Corporate Mitras" will be the ones helping MSMEs (micro, small, and medium enterprises) to continue their compliance work.

The government, with a special emphasis on learning and creation of jobs in the services sector, will establish a high- powered "Education to Employment and Enterprise" standing committee to give recommendations, identify high growth sub-sectors, remove policy and regulatory gaps, and look into the possibilities of services export.

“The committee will prioritise areas to optimise the potential for growth, employment and exports. The panel will also assess the impact of emerging technologies, including artificial intelligence (AI), on jobs and skill requirements, and propose measures thereof,” Sitharaman said.

“The creation of this committee presents an excellent opportunity to identify and prioritise critical areas that can optimise growth, enhance employment opportunities, and boost exports. By focusing on skill development and aligning educational outcomes with industry needs, we can ensure that our workforce is well-prepared to meet the challenges and demands of the modern economy,” said Suchita Dutta, executive director of Indian Staffing Federation (ISF).

In another initiative, to promote employability in the new economy, Sitharaman proposed to support the Indian Institute of Creative Technologies in Mumbai to create animation, visual effects, gaming and comics (AVGC) content creator labs in 15,000 secondary schools and 500 colleges.

Additionally, a new National Institution of Design will be created to boost design education and development in the eastern region of India. Also, five university townships will be set up near major industrial and logistics corridors, which will host multiple universities, colleges, research institutions, skill centres, and residential complexes.

“These planned academic zones will host multiple universities, colleges, research institutions, skill centres, and residential complexes,” said Sitharaman.

“As hiring momentum builds across infrastructure, manufacturing, services, and emerging technologies, employability will increasingly be defined by role-based skills and the ability to continuously reskill. Aligning academic curricula with industry demands can not only considerably lessen the gap between education and employment but also prepare youngsters to the workforce entry at the level of job, ready without much post, hire training, as per Aditya Narayan Mishra, managing director and chief executive officer (MD&CEO) of CIEL HR.

The Ministry of Skill Development and Entrepreneurship (MSDE) was given a budget of 9, 886 crore, which is a 62 percent increase from 6, 100 crore in the previous budget.

In addition, Sitharaman declared an experimental program for reskilling 10, 000 tourist guides at 20 world famous places through a standardized, high quality 12, week training course in hybrid mode, done in partnership with an Indian Institute of Management (IIM).

“The strong focus on demand-linked training, sector-specific skilling, and alignment with national qualification frameworks will be critical in ensuring quality, mobility, and employability at scale. This integrated approach provides a strong foundation to support inclusive growth, enterprise expansion, and India’s long-term competitiveness,” said Veenu Jaichand, partner-skill and employability, government and public sector, EY India.

Additionally, she announced the creation of a National Destination Digital Knowledge Grid to digitally document all places of cultural, spiritual, and historical significance. “This initiative will create a new ecosystem of jobs for local researchers, historians, content creators, and technology partners,” she added.

“With initiatives like AHP (allied health professionals) institutions, multi-skilled caregiver training, medical tourism hubs, and a National Institute of Hospitality, India is building the workforce backbone the world increasingly needs. This positions India strongly to meet both domestic demand and global talent requirements in care and services. This is a decisive shift towards investing in vocational and applied skills. By scaling care, health, and hospitality talent, India is positioning itself as a reliable workforce partner for the world’s growing service and care needs,” said Mayank Kumar, CEO and cofounder of BorderPlus.

Highlighting the role of the sports sector in employment generation, Sitharaman announced the launch of a new, revitalised Khelo India Mission to transform sports over the next decade. This initiative will be supported by training centres, training of coaches and support staff, and development of sports infrastructure.

The Ministry of Labour and Employment received a record allocation of ₹32,666 crore, up from an allotment of ₹32,646 crore in the 2025-26 Budget. Notably, only about 39 per cent of this was utilised as the Revised Estimate for the ministry amounted to ₹12688.05 crore. The ministry also received its first allocation for its flagship employment scheme Pradhan Mantri Viksit Bharat Rozgar Yojana (PM-VBRY), announced in August 2025, at ₹20,083 crore.