FOR OFFICIAL USE ONLY Report No: RES46634 INTERNATIONAL DEVELOPMENT ASSOCIATION RESTRUCTURING PAPER ON A PROPOSED PROGRAM RESTRUCTURING OF SKILLS STRENGTHENING FOR INDUSTRIAL VALUE ENHANCEMENT OPERATION APPROVED ON MARCH 2, 2017 TO REPUBLIC OF INDIA Education Global Practice South Asia Region Regional Vice President: Hartwig Schafer Country Director: Junaid Kamal Ahmad Regional Director: Lynne D. Sherburne-Benz Practice Manager: Mario Cristian Aedo Inostroza Task Team Leader(s): Shobhana Sosale, Shiro Nakata The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) ABBREVIATIONS AND ACRONYMS AIC Apprenticeship Implementation Cell AM Aide Memoire ATI Advanced Training Institute CITS Craft Instructors Training Scheme CPD Continuing Professional Development CSTARI Central Staff Training and Research Institute CTS Craftsmen Training Scheme DEA Department of Economic Affairs DGT Directorate General of Training DLI Disbursement-linked Indicators DLP Distance Learning Program DLR Disbursement-linked result GoI Government of India IC Industry Cluster IE Impact Evaluations IPF Investment Project Financing ISP Institutional Strategic Plans ISR Implementation Status and Results ITI Industrial Training Institutes LFP Labour Force Participation M&E Monitoring and Evaluation MoF Ministry of Finance MIS Management Information Systems MSDE Ministry of Skill Development and Entrepreneurship MSME Micro, Small and Medium Enterprise NCVET National Council of Vocational Education and Training NCVT National Council of Vocational Training NIMI National Instructional Media Institute NPIU National Program Implementation Unit NSDC National Skills Development Corporation NSDM National Skill Development Mission OJT On the Job Training PAD Project Appraisal Document PAP Program Action Plan PBGA Performance-Based Grant Agreements PforR Program for Results PMC Program Management Consultant RDAT Regional Directorates of Apprenticeship Training SME Small and Medium Enterprise SPIU State Program Implementation Unit STRIVE Skills Strengthening for Industrial Value Enhancement TA Technical Assistance VTIP Vocational Training Improvement Project The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. Please delete this note when finalizing the document. DATA SHEET (Skills Strengthening for Industrial Value Enhancement Operation - P156867) BASIC DATA Project ID Financing Instrument IPF Component P156867 Program-for-Results Financing No Approval Date Current Closing Date 02-Mar-2017 30-Nov-2022 Organizations Borrower Responsible Agency Department of Economic Affairs, Ministry of Finance Ministry of Skill Development and Entrepreneurship Program Development Objective(s) To improve access to quality and market-driven vocational training provided in ITIs and apprenticeships OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Approval Effectiveness Closing Ln/Cr/TF Signing Date Commitment Disbursed Undisbursed Date Date Date 02-Mar- 30-Nov- IDA-59650 19-Dec-2017 08-Feb-2018 125.00 62.35 62.65 2017 2022 Policy Waiver(s) Does the Program require any waivers of Bank policies applicable to Program-for-Results operations? No Page 1 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) I. PROGRAM STATUS AND RATIONALE FOR RESTRUCTURING A. PROGRAM INFORMATION 1. The Skills Strengthening for Industrial Value Enhancement (STRIVE) is a five-year national Program for Results (PforR) operation with the closing date of November 2022. The objective of the operation is to improve access to quality and market-driven vocational training provided in Industrial Training Institutes (ITIs) and apprenticeships. STRIVE aims to incentivize critical institutional reforms required in institutional skills training and apprenticeship systems of the Directorate General of Training (DGT) of the Ministry of Skill Development and Entrepreneurship (MSDE). An associated Investment Project Financing (IPF) instrument was designed for Technical Assistance (TA). The Government of India’s (GoI) National Policy for Skill Development and Entrepreneurship, and the policy implementation framework of the National Skill Development Mission (NSDM) is the overarching framework for the STRIVE operation. B. PROGRAM STATUS 2. Overall Progress: Despite the emergence of the COVID-19 pandemic in March 2020, and the resurgence of the pandemic in 2021, project implementation progress has registered and continues to register significant improvements. The progress is in the following areas: (a) the ITIs have initiated the implementation of the Perfromance-based Financing Agreement, and 200 ITIs have signed the agreements as of May 2021, and have expanded participation in on-the-job (OJT) training for trainees; (b) four Industry Clusters (ICs) have initiated apprenticeship training programs for disadvantaged youth under the Industry Apprenticeship Initiative (IAI); (c) nine States have initiated the process for undertaking graduate tracer studies to assess the employability of ITI graduates; and (d) the capacity of the National Project Implementation Unit (NPIU), States, and ITIs has been strengthened in the areas of fiducairy and safeguard management and monitoring and evaluation. Progress towards achieving the project development objective is now Moderately Satisfactory. 3. Disbursement: Notable progress has been made in all the results areas and disbursement has improved significantly. In FY21, the DLI achievement of US$29 million has been confirmed, bringing the total disbursed amount from DLIs to US$62.35 million, including the advance of US$30 million. In addition, the Independent Verification Agency (IVA) is in the process of verifying one DLR in the amount of about US$2.6 million, and another DLR in the amount of US$2.1 million is also likely to be achieved during FY21. The remaining DLRs are achievable by the project closing date of November 2022 subject to project implementation pace being maintained at the current pace. The resurgence of the COVID-19 pandemic situation in the country now poses a new risk to the ongoing project implementation efforts. C. RATIONAL FOR RESTRUCTURING 4. Cancellation of US$1 million: During the Mid-Term Review (MTR) in January 2021 the Department of Economic Affairs (DEA), DGT, MSDE and the World Bank discussed: (a) the utilization of the project funds, and (b) the possibility of cancelling some project funds that might remain unused. Subsequently, in April 2021, the DGT identified US$1 million from the Technical Assistance component that would be unused. The DGT informed the DEA vide a letter dated October 16, 2020. This was subsequently confirmed at the Tripartite Portfolio Review Meeting (TPRM) on January 22, 2021. The DEA confirmed the cancellation and the amount in the letter to the World Bank dated April 30, 2021. The requested cancellation amount of US$1 million from the Technical Assistance component will not affect project implementation. Page 2 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) II. DESCRIPTION OF PROPOSED CHANGES 5. The only change in the proposed restructuring is the cancellation in the amount of US$1 million from the Technical Assistance component. As a result of the cancelation, the total allocation to the Technical Assistance component will be reduced from US$6 million to US$5 million. Consequently, there will be a commensurate reduction in the total project financing envelop from US$125 million to US$124 million. This corresponds to the PforR component in the amount of US$119 million, and the Technical Assistance component (IPF) of US$5 million. 6. The proposed restructuring does not involve any changes to the other aspects of the project. The Project Development Objective, the results indicators, and the DLIs will remain unchanged. 7. There are no changes in the Results Framework and the Program Action Plan presented in Annexes 1 and 2, respectively. These are automatically populated by the system and may be ignored for the present purposes. III. SUMMARY OF CHANGES Changed Not Changed Change in Cancellations Proposed ✔ Reallocation between and/or Change in DLI ✔ Change in Implementing Agency ✔ Change in Program's Development Objectives ✔ Change in Program Scope ✔ Change in Results Framework ✔ Change in Loan Closing Date(s) ✔ Change in Disbursements Arrangements ✔ Change in Disbursement Estimates ✔ Page 3 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) Change in Systematic Operations Risk-Rating Tool ✔ (SORT) Change in Safeguard Policies Triggered ✔ Change in Legal Covenants ✔ Change in Institutional Arrangements ✔ Change in Technical Method ✔ Change in Fiduciary ✔ Change in Environmental and Social Aspects ✔ Change in Implementation Schedule ✔ Other Change(s) ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_COMPONENTS_TABLE OPS_DETAILEDCHANGES_CANCELLATIONS_TABLE CANCELLATIONS PROPOSED Value Current Cancellation New Reason for Ln/Cr/TF Status Currency Date of Amount Amount Amount Cancellation Cancellation BORROWER'S IDA-59650- Disburs 125,000,000.0 124,000,000. REQUEST FOR USD 1,000,000.00 30-Apr-2021 001 ing 0 00 COUNTRY REASONS OPS_DETAILEDCHANGES_EA_TABLE . Page 4 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) ANNEX 1: RESULTS FRAMEWORK . . Results framework Program Development Objectives(s) To improve access to quality and market-driven vocational training provided in ITIs and apprenticeships Program Development Objective Indicators by Objectives/ Outcomes RESULT_FRAME_TBL_PDO Indicator Name DLI Baseline End Target Results Area 1: Improved Performance of Industrial Training Institutes Increase in the number of graduates from ITIs that have signed 0.00 20.00 PB Grant Agreements (Percentage) Female enrollment rate in ITIs with signed PB Grant Agreements 9.70 15.00 (Percentage) Percentage of graduates from ITIs that have signed PB Grant Agreements who are in gainful employment one year after 50.00 50.00 graduation (Percentage) Results Area 2: Increased capacities of State Govts. to support ITIs and Apprenticeship Training Number of Participating States that have reduced the vacancies of sanctioned trainers’ posts by at least 20% in government ITIs 0.00 15.00 (Number) Page 5 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) RESULT_FRAME_TBL_PDO Indicator Name DLI Baseline End Target Results Area 3: Improved Teaching and Learning Number of teachers who have completed pre-employment or in- 5,000.00 20,000.00 service distance learning/blended modules (Number) Results Area 4: Improved and Broadened Apprenticeship Training Number of ICs that have introduced at least 2 different apprenticeship programs within their participating (member) 0.00 30.00 industries (Number) Crosscutting Direct Operation beneficiaries; % Female (Text) 0; Female: 0% 400000; Female: 12% PDO Table SPACE Intermediate Results Indicators by Result Areas RESULT_FRAME_TBL_IO Indicator Name DLI Baseline End Target Results Area 1: Improved Performance of Industrial Training Institutes IR Indicator 1.1: Percentage increase in enrollment across ITIs 0.00 25.00 with signed PB Grant Agreement (Percentage) IR Indicator 1.2: Percentage of trainees undergoing OJT across 2.00 25.00 ITIs with signed PB Grant Agreements (Percentage) Results Area 2: Increased Capacities of State Govts. to support ITIs and Apprenticeship Training IR Indicator 4.1: Number of Participating States that have 0.00 15.00 conducted tracer studies (Number) Page 6 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) RESULT_FRAME_TBL_IO Indicator Name DLI Baseline End Target IR Indicator 4.2: Percentage of trainees in government ITIs who 1.35 4.00 are from ST populations (Percentage) Results Area 3: Improved Teaching and Learning IR Indicator 5.1: Number of CTS trades for which ICT-based 0.00 4.00 teaching and learning packages have been developed (Number) IR Indicator 5.2: Number of CITS trades upgraded (Number) 0.00 4.00 Results Area 4: Improved and Broadened Apprenticeship Training IR Indicator 6.1: Number of ICs receiving IAI Grants that have reached a female enrollment of 12% in their respective 0.00 10.00 apprenticeship programs (Number) IO Table SPACE Disbursement Linked Indicators Matrix DLI IN00990956 ACTION DLI 1 Increase in the number of graduates from ITIs that have signed PB Grant Agreements Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Outcome Yes Text 18,000,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 0.00 FY2017/18 (Year 1) 0.00 FY2018/19 (Year 2) 0.00 Page 7 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) FY2019/20 (Year 3) 18,000,000.00 FY2020/21 (Year 4) 0.00 FY2021/22 (Year 5) 0.00 DLI IN00990957 ACTION Improvement in industrial training and employment outcomes for trainees and graduates of ITIs that have signed PB Grant DLI 2 Agreements Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Outcome No Text 21,000,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 2%,50% FY2017/18 (Year 1) 0.00 FY2018/19 (Year 2) 0.00 FY2019/20 (Year 3) 11,000,000.00 FY2020/21 (Year 4) 4,000,000.00 FY2021/22 (Year 5) 6,000,000.00 Page 8 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) DLI IN00990958 ACTION DLI 3 Reduction in ITIs’ trainer vacancies and improvements in training of trainers Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Outcome Yes Text 20,500,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 0,0 FY2017/18 (Year 1) 0.00 FY2018/19 (Year 2) 0.00 FY2019/20 (Year 3) 5,500,000.00 FY2020/21 (Year 4) 11,200,000.00 FY2021/22 (Year 5) 3,800,000.00 DLI IN00990959 ACTION DLI 4 Number of Participating States that have conducted tracer studies Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Intermediate Outcome Yes Text 18,000,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 0.00 FY2017/18 (Year 1) 0.00 FY2018/19 (Year 2) 0.00 Page 9 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) FY2019/20 (Year 3) 2,000,000.00 FY2020/21 (Year 4) 6,000,000.00 FY2021/22 (Year 5) 10,000,000.00 DLI IN00990960 ACTION Number of ICs that have introduced at least 2 different apprenticeship programs within their participating (member) DLI 5 industries Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Outcome Yes Text 22,500,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 0.00 FY2017/18 (Year 1) 0.00 FY2018/19 (Year 2) 1,500,000.00 FY2019/20 (Year 3) 21,000,000.00 FY2020/21 (Year 4) 0.00 FY2021/22 (Year 5) 0.00 Page 10 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) DLI IN00990961 ACTION DLI 6 Increase in female enrollment rate in ITIs with PB Grant Agreements and ICs receiving IAI Grants Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Outcome Yes Text 19,000,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 9.7%,0 FY2017/18 (Year 1) 0.00 FY2018/19 (Year 2) 0.00 FY2019/20 (Year 3) 7,000,000.00 FY2020/21 (Year 4) 6,500,000.00 FY2021/22 (Year 5) 5,500,000.00 Note to Task Teams: End of system generated content, document is editable from here. Please delete this note when finalizing the document. Page 11 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) ANNEX 2: PROGRAM ACTION PLAN Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. Please delete this note when finalizing the document. . . PAP_NOT_CHANGE_TBL Action Description Source DLI# Responsibility Timing Completion Measurement PMC in place Technical Client Due Date 08-Feb-2019 Award of contract OM, including ITI PB Grant Agreement Scheme Guidelines, State Performance- Based Funding Scheme Operations Manual approved by Guidelines, and IAI the National Steering Committee Grant Mechanism (NSC) and adopted by the Guidelines, National Project Implementation completed Technical Client Due Date 30-Apr-2018 Unit (NPIU). Functional procurement complaint handling and Availability on project website redressal and reports generated from the mechanism Other Client Due Date 08-Feb-2019 system Procurement plan for first 18 First 18 months months is uploaded on the Procurement Plan project website and was also updated and submitted to the World Bank task submitted to Bank Technical Client Due Date 21-Nov-2017 team. Inclusion. All ISPs to include a plan for inclusion of ISPs have been received and vulnerable groups Technical Client Due Date 01-Aug-2018 contain an inclusion plan. Gender. Study to understand the demand- and supply-side constraints for women to enter skills training and subsequently transition into the Study completed and shared with labor market Technical Client Due Date 08-Feb-2019 the World Bank Page 12 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) MIS. Develop a system to disaggregate data pertaining to SCs, STs, OBCs, women, minorities, and persons with disabilities as part of tracer studies for ITI graduates ToRs for tracer studies to include to be requirement for disaggregation of implemented by data pertaining to SCs, STs, OBCs, states under the women, minorities, and persons Program Technical Client Recurrent Yearly with disabilities Each ITI should have a designated nodal person on environmental and safety management who Robust would be responsible to environmental undertake following broad management environmental management in system developed respective ITI. These include and functioning in Environmental and Social onsite construction management ITIs Systems Client Recurrent Continuous covering the aspects Training to staff and students of each ITI on OHS and environment, including hazardous waste, completed. The PB Grant Agreement to include provisions to ensure that students use safety Students aware of gear in workshop, are clearly and practice good Environmental and Social communicated OHS measures, safety norms in ITI Systems Client Recurrent Continuous and use Grant agreement on IAIs to Apprenticeship include provisions to ensure that enforce good OHS apprentices are aware of and and waste practice good OHS measures, and management Environmental and Social proper waste management standards Systems Client Recurrent Continuous systems in place and functional Disclosure of approved Procurement Plans on project website Other Client Recurrent Continuous Year 2: 20%, Year 4: 40% Initiate procurement for Independent Verification Firm Technical Client Due Date 30-Nov-2017 IVA onboarded . Page 13 of 14 The World Bank Skills Strengthening for Industrial Value Enhancement Operation (P156867) Note to Task Teams: End of system generated content, document is editable from here. Please delete this note when finalizing the document Page 14 of 14