[Gist of Kurushetra November 2020] Rural Self-Employment Training Institutes


• The unemployment rate in urban areas was recorded nearly 6 percent while in rural areas it was nearly 10 percent.

• According to the latest data, there may be 18.9 million unemployed people in India by December 2019. Due to COVID-19, this number may increase further. To tackle the issue of unemployment, self-employment is the best alternative.

• To fulfill this cause, Ministry of Rural Development (MoRD) has opted the concept of Rural Self Employment Training Institutes (RSETIs).

• The role played by RSETIs in India is to facilitate youth to start their own business by providing them skill upgradation programmes and training them in latest technologies.

• The RSETIs are extending their support to the youth who are willing to take up self-employment activities. The entrepreneurship development in rural youth has to take place by stimulating their mind followed by bringing in the appropriate technology training and credit within their reach.

Objectives and Scope of the RSETIs:

• Rural youth belonging to poor families are identified and trained for Self-employment.

• The training programs conducted will be demand driven.

• The trainees will be provided intensive short-term residential training programmes free of cost, with food and accommodation.

• To develop confidence in unemployed youth.

• To promote rural entrepreneurship.

• Handholding support for credit linkage with banks.


• Rural Self Employment Training Institutes (RSETIs) are unique skill development organisations operating in districts across the country. They are engaged in developing skill among the unskilled/semi-skilled persons and facilitate the trained persons to establish rural enterprises and secure sustainable livelihoods. Though RSETIs are sponsored and managed by different banks, they have a common objective of promoting the creation of sustainable rural enterprises. The Union Ministry of Rural Development, the Banks and the State Governments are the partners in the RSETI concept.

• The important feature of RSETI scheme is its free residential training of 6 to 45 days duration and long-term hand-holding support for two years. The RSETIs are required to provide training to the rural youth under entrepreneurship activity. This initial residential training gives an opportunity for the trainees to live in a different environment with extended hours of learning which also facilitates to change the mindset of trainees towards a positive attitude in their life.

• To start the initiative, the Ministry of Rural Development (MoRD), Government of India, advised the banks in 2009 to set up one RSETI in each district by the concerned Lead Bank with the support of the State Government.

Salient features:

• Every RSETI should conduct 30-40 different Skill Development Training Programmes in a financial year. All programmes should be of short; duration, ranging from 1 to 6 weeks. Each RSETI should provide training to a minimum of 750 rural youth belonging to the Below Poverty Line (BPL) category. The programmes can be related to agriculture and non-farm sector, ranging from Agriculture-dairy, poultry, fisheries, etc., repair of irrigation pump sets, tractors, mushroom farming, vermin-compost, manufacturing of agarbatti/soaps, Desktop publishing (DTP), tailoring, beauty parlor, etc.

• To establish RSETIs and to remove bottlenecks in the smooth functioning of RSETIs, a National Level Steering Committee consisting of members from RBI, NABARD, banks etc. has been set up under the Chairmanship of Secretary, MoRD. National Institute of Rural Development (NIRD), Hyderabad is the nodal agency for implementation of RSETI project.

• Certain minimum basic standards for the RSETIs to be set up by the sponsored banks have been proposed in the guidelines. As per guidelines, two to three classrooms with separate toilet facilities for women and men, two workshops, office room for Director and rooms for administration, maintenance, reception, etc. are to be established. Hostel facility for trainees should include two dormitories with bath and toilet facilities, one kitchen, and a dining hall. Residential quarters for Director and supporting staff are also to be created in the setup.

• RSETI is an independent body and separate from the bank. It’s functioning and management is to be looked after by a Director on deputation from the sponsoring bank. Faculty for training and other supporting staff can be engaged on a contract basis or maybe deputed from the sponsoring bank. Salary of the Director is to be borne by the sponsoring bank. Recurring expenses incurred by the RSETIs like lodging and boarding of trainees are reimbursed by the DRDA (District Rural Development Agency) and expenses for capacity building like wages of trainers, logistics, etc. are reimbursed by the NABARD/SIDBI.

• RSETIs are mandated to impart training to unemployed rural youth particularly from BPL families and develop skills and build up the confidence to take up the entrepreneurial activity. Training programmes can be designed/modified as per the requirements in the locality in consultation with the Local Advisory Committee. Support of NIRD can also be sought to make the programme more focused and take into consideration the potential opportunities in the area. Depending on the changing needs, new programmes may be designed or old programmes can be modified suitably to incorporate the requirements.

• Objective of the RSETI is creation of micro-enterprises or self-employment opportunities in rural areas. RSETI should endeavor to provide credit linkages to the trainees after completion of their training. Involvement of all the stakeholders in sponsoring candidates for training will also result in better credit linkage. Regular interaction with the bank branches, government agencies, and ex-trainees is necessary to overcome problems in credit linkages for undertaking the entrepreneurship activity. After training, constant follow up with the candidates for at least two years is necessary to help them to remove hurdles and instill confidence for the establishment of a successful vocation.

Way ahead:

• It is understood that nearly 25 lakh unemployed youth have been settled with the help of RSETIs across the country. In addition to their own settlement, some of them have been providing employment to others as well, thereby transforming from the stage of unemployed to employer. RSETIs are a very cost-effective medium for creating employment.

• They have the ability to drive the local economy and for all stakeholders it is a win-win proposition.

• All the stakeholders need to implement the scheme in true spirit by taking active measures to increase the number of RSETIs and strengthen the existing RSETIs, in order to make the Prime Minister Shri Narendra Modi’s dreams like Skill India, Startup India, Standup India, AatmaNirbhar Bharat a reality within a shorter period.

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