Entrepreneurship And Skill Development Programme (ESDP)

Policy Update
Bavleen

Background

India’s push for self-employment and micro-enterprise development has taken several forms over the decades, but the Entrepreneurship and Skill Development Programme (ESDP) is among the more enduring efforts in this space. Operated by the Ministry of Micro, Small and Medium Enterprises (MSME), the programme gradually evolved from smaller training initiatives into a national framework aimed at nurturing first-generation entrepreneurs and strengthening the existing skills base of the MSME sector.

The idea behind ESDP emerged from a recurring on-ground reality: India’s MSMEs contribute significantly to GDP and employment, but many entrepreneurs – especially those without family business backgrounds – struggle with basic managerial understanding, exposure to new technologies, market linkages, and financial literacy. The programme was created to bridge these gaps precisely. Its target groups include unemployed youth, women, artisans, workers seeking upskilling, and individuals from socially and economically disadvantaged communities.

ESDP’s approach has always been simple but practical – provide structured training, build confidence, expose participants to available schemes, and help them take those first steps towards formalising or expanding small businesses. Over time, as self-employment gained prominence (especially after COVID-19), the programme has become even more relevant for those searching for sustainable livelihood options.

Functioning

The implementation of ESDP is spread across the country through MSME Development and Facilitation Offices, Technology Centres, and partner institutions. While the overall framework is national, individual centres adapt their training modules to local opportunities.

The programme broadly operates through four categories:

Entrepreneurship Awareness Programmes (EAPs): Introductory sessions that familiarise students, youth, and community groups with the idea of entrepreneurship.
Entrepreneurship Development Programmes (EDPs): Longer courses that walk participants through business planning, costing, quality requirements, regulation, digital tools, and accessing government schemes.
Skill Development Programmes (SDPs): Hands-on technical training in trades such as food processing, electronics repair, tailoring, design, digital marketing, CNC machining, or crafts – depending on local industry.
Management Development Programmes (MDPs): Short programmes for existing entrepreneurs who need guidance on inventory, finances, branding, or digital systems.

One feature that sets ESDP apart from many other training schemes is the freedom provided to centres to adapt. A cluster with strong bamboo resources in the Northeast may get bamboo-processing training, while a textiles-heavy area in Tamil Nadu may receive pattern-making or design modules. This localisation has helped the programme stay meaningful rather than becoming a one-size-fits-all model.

That said, several committee reports observed that while training delivery is generally satisfactory, the journey from training to successful enterprise creation still depends heavily on credit, market conditions, and availability of mentors – areas beyond the programme’s immediate control.

Performance (2022–2025)

The last three years show sustained growth in participation. According to the data from the Ministry of MSME:

2022-23: Around 4.8 lakh people were trained across India.
2023-24: Participation crossed 6 lakh, partly due to more women joining service-sector and digital modules.
2024-25 (till December 2024): Over 4.5 lakh trainees had completed courses, suggesting the year’s target of 6.5 lakh will likely be met.

Women’s participation has been especially encouraging, hovering around 40% in most years. States such as Kerala, Telangana, Odisha, and Uttarakhand consistently report strong enrolments in digital skills, food processing and craft-based training. The programme’s annual budget, which typically ranges between ₹150–₹180 crore, has remained stable and adequate for basic training needs.

However, the more important indicator – enterprise creation remains patchy. Parliamentary committee observations underline that only a fraction of trainees are formally tracked after training. Small studies by state centres show that roughly 10-15% of participants establish micro-enterprises within a year, while others join wage employment or support family businesses. This does not mean the programme has limited value; it simply reflects that enterprise creation depends on a constellation of factors, not training alone.

Impact

The programme’s impact can be seen most clearly in how it broadens access to entrepreneurship. Many participants – women who have never handled business accounts, artisans unfamiliar with digital tools, or youth unsure of where to begin often report that ESDP gives them a starting point they lacked earlier.

Several outcomes stand out:

Increased confidence among first-time entrepreneurs, especially women and rural youth.
Better integration of artisans into formal markets, through training in design, packaging, and digital selling.
Movement from low-value to higher-value activity in clusters like handloom, food processing, and handicrafts.
Improved digital familiarity, including UPI payments, online marketing, and GST basics.

In stronger industrial states – Karnataka, Maharashtra, Tamil Nadu – trainees often find it easier to sustain new enterprises due to better market support. In other regions, enterprise survival tends to fluctuate because of credit challenges or limited local demand.

ESDP has also become a stepping stone for other MSME schemes. Many trainees later apply for MUDRA loans, PMEGP assistance, or cluster-based support, indicating that the programme functions as an entry point into the larger entrepreneurial ecosystem.

Emerging Issues

A closer reading of committee reports, ministry notes, and field insights highlights several recurring issues:

Post-training mentoring is minimal, which weakens the transition from learner to entrepreneur.
Credit remains a bottleneck; trainees often face hesitation from banks, particularly first-generation entrepreneurs.
Training quality varies across centres, depending on available faculty and infrastructure.
Digital divides persist, limiting participation in technology-heavy modules.
There is no strong system to track long-term outcomes, making evaluation difficult.
Industry partnerships are limited, reducing real exposure for trainees.

Suggestions

Develop district-level mentorship networks, possibly involving retired professionals, local industry members, and NGOs.
Formalise credit linkages with banks and NBFCs specifically for ESDP graduates.
Introduce uniform quality standards for training centres.
Expand blended learning – short offline workshops supported by simple, mobile-friendly training modules.
Build stronger partnerships with associations in textiles, food processing, engineering, and digital services.

Way Forward

The ESDP has quietly supported India’s entrepreneurial ecosystem for years, even without the visibility enjoyed by flagship schemes. Yet the programme now stands at a point where its role could expand considerably. If India is serious about encouraging self-employment, local enterprise development, and inclusive growth, ESDP must gradually evolve from a training provider into a complete support ecosystem.

This would require reliable post-training support, deeper industry involvement, more structured credit pathways, and better tracking. With these reforms, ESDP could help translate India’s demographic potential into a genuinely entrepreneurial workforce – one that blends technical skills with the confidence to innovate, experiment, and build local economic resilience.

Selected References

1. Ministry of Micro, Small and Medium Enterprises. (2024). MSME Annual Report 2023–24. Government of India. https://msme.gov.in/sites/default/files/FINALMSMEANNUALREPORT2023-24ENGLISH.pdf

2. Ministry of Micro, Small and Medium Enterprises. (2023). MSME Annual Report 2022–23. Government of India. https://msme.gov.in/sites/default/files/MSMEANNUALREPORT2022-23ENGLISH.pdf

3. Development Commissioner, MSME. (2024). Entrepreneurship and Skill Development Programme (ESDP): Training Dashboard and MIS Data. Government of India. https://dcmsme.gov.in

4. Press Information Bureau. (2023). Government initiatives for entrepreneurship development in the MSME sector. Government of India. https://pib.gov.in

5. Ministry of Micro, Small and Medium Enterprises. (2022). Entrepreneurship and Skill Development Programme: Scheme Guidelines. https://www.msme.gov.in/

6. NIESBUD (National Institute for Entrepreneurship and Small Business Development). (2023). Annual Training Report 2022–23. https://niesbud.nic.in

7. Indian Institute of Entrepreneurship (IIE). (2023). Training Activities and Impact Assessment Report. https://iie.gov.in