New Delhi: A financing agreement for an International Development Association (IDA) credit of $50 million for the Nai Manzil Education and Skills Training for Minorities was signed here with the World Bank yesterday. The agreement was signed by Joint Secretary at Department of Economic Affair (DEA) Raj Kumar on behalf of the government and World Bank’s Operations Adviser in India Michael Haney.
The total project size is $100 million, out of which $50 million will be available as IDA credit, and the balance will be funded from the Union Budget.
Twenty per cent of young people (i.e. those between 17 and 35 years of age) from minority groups (notified minorities consist of Muslims, Parsees, Jains, Buddhists, Christians, and Sikhs) are out of the labour force, which is higher than their share of the youth population. While overall the trend has been for youth in India to receive more years of formal education, youth from certain minority communities are more likely to experience lower levels of education and are more likely to be unemployed. According to the National Sample Survey 2011-2012, Muslim youth have the lowest labor market outcomes. They earn 25-30 percent lower wages, are 50% less likely to be engaged in the formal sector and have higher rates of unemployment.
A recent World Bank study of select skills training programmes in 5 States of India found that well-designed skills training programs make a positive difference; beneficiaries were found to experience a seven percentage point increase in employment (with a stronger result for women than for men) and a 21% increase in their wages. In addition, formal education continues to shape employment outcomes and long-term productivity of the youth. Youth with primary education (or less) receive 12% lower wages than those with secondary education, the study found.
“The objective is to help these youth to extend their formal education and enter the labor market with better employment prospects. The project will also incentivize the education and training providers to provide placement support to these students, and track them for a certain period after they have completed the study or training program,” said Muna Salih Meky, Senior Education Specialist, World Bank and John D Blomquist, India Program Leader, Inclusion and the World Bank’s Task Team Leaders for the project.
The credit is from the International Development Association (IDA) – the World Bank’s concessionary lending arm – the credit is on IDA terms with a maturity of 25 years, including a 5 year grace period.
The project takes an integrated and holistic approach towards education and skill development of the youth among the minorities to address the high dropout and unemployment rate among them. Minority BPL (below poverty line) youth in the age group of 17-35 years will be the main beneficiaries of the project.
Improvement in the education attainment of the said section of the Indian population in the project area and improvement in their employability skills are among the expected outcomes of the project. The project will follow a result-based financing modality. Project funds will be disbursed on achieving specific results such as the number of students enrolled, those students successfully completing education and skill components etc. The closing date of the project is 31 October 2021.
“The Nai Manzil Scheme is designed as an integrated education and training program that provides youth from minority communities skills that are needed for different tasks in a rapidly changing world. Interventions under this project will support the Nai Manzil Scheme in improving the employability and performance of minority youth in the labor market,” said Kumar.
“India’s demographic dividend can be harnessed only if all young people from all sections of society are equipped with the education and skills needed to make them productive members of the economy,” said Haney, adding, “This project reflects the government’s intent to provide opportunities for youth from minority communities to acquire the education and training that they might have missed out on. We hope it will improve the employability and earning capacity of youth, particularly that of women, in these communities.”
Representatives from the Ministry of Minority Affairs and officials from the World Bank were present on the occasion.