MSME Tool Rooms: Revenue, number of trainees trained, units assisted fall to lowest for FY21 in six years

MSME Minister Nitin Gadkari in August 2020 had said that 15 new tool rooms are being set up along with upgrading the existing 18 such centres to assist MSMEs.

Skill, Labour, Talent for MSMEs: The combined revenue for 18 MSME Tool Rooms or Technology Centres — operated by the Ministry of MSME across the country — in the financial year 2020-21 has been the lowest in the past six financial years. According to the available government data, the tool rooms earned Rs 195 crore revenue in FY21 amid Covid vis-à-vis Rs 351 crore in FY20 and Rs 268 crore in FY16. Likewise, the total number of trainees trained at these tool rooms and the overall number of MSME units assisted were also lowest in FY21. While 1.33 lakh trainees were trained in FY21 in comparison to 2.73 lakh in FY20 and 1.78 lakh in FY16, the number of units assisted stood at 27,831 in FY21 viz., 43,762 in FY20 and 36,156 in FY16, the data showed.

Comments from the MSME Ministry for this story weren’t immediately available.

Source: MSME Dashboard, Ministry of MSME

“If there is loss of jobs in my company, for whom will you train? You will reduce the number of people for training. So, my requirement of people itself will go down. Who will come to you for training if they don’t get employment or if companies don’t want people? Covid is also one of the key reasons for the drop,” Vijay Kalantri, President, All India Association of Industries (AIAI) and Chairman, MVIRDC World Trade Center, Mumbai told Financial Express Online.

The tool rooms provide precision tooling along with new technologies including CAD/CAM, CNC machining for tooling, vacuum heat treatment, rapid prototyping, etc. apart from providing skilled manpower. The existing centres cater to markets such as footwear, electronic system design and manufacturing (ESDM), aerospace, auto parts, sports goods, glass, fragrance, and flavour, etc. located in cities and towns including in Bhubaneswar, Jamshedpur, Kolkata, Ahmedabad, Ludhiana, Chennai, Bhopal, Bengaluru, Pudi, Rohtak, Guwahati, etc.

Also read: Covid 2.0-induced migrant workers’ exodus unlikely to mirror last year’s move for MSMEs, others: Experts

Importantly, the number of trainees trained in FY21 had exceeded the 1.7 lakh trainees target set by the government. For FY20 as well, the number of trainees trained was more than 2.69 lakh targeted trainees to be trained while for the remaining FYs, the tool rooms had fallen short of meeting the set target, according to the data available on MSME Dashboard.

MSME Minister Nitin Gadkari in August 2020 had said that 15 new tool rooms are being set up along with upgrading the existing 18 such centres to assist MSMEs in their technical upgradation and also to create skilled manpower required to make India a manufacturing hub. However, the government was later looking to lease these centers to engineering institutions for practical training to the youth towards research and innovation.

“We already have a lot of technology centers in the country and till now we have invested Rs 6,000 crore in it. But now we are planning to give technology centers on a lease basis to engineering colleges, IITs, polytechnic colleges, and industry associations for them to understand what exactly practical training is needed in that area. We need to develop products, designs and it is the need of the hour,” Gadkari had said in December during a webinar organised by a pro-entrepreneurship alliance of organisations — Global Alliance for Mass Entrepreneurship (GAME).