India engaged more than 11.84 lakh apprentices under the National Apprenticeship Promotion Scheme (NAPS) in 2025, the highest annual number since the scheme began. Yet the ceiling sits far above the floor. The NAPS portal has posted over 77 lakh vacancies since 2016, and barely half of all apprentices now complete their training.
Behind that drag sits a legal regime that mandates apprenticeships for most mid-sized and large employers, a central scheme that reimburses part of the stipend, and a stipend table that was revised upward with effect from 11 September 2025. HR teams at establishments crossing the 30-worker threshold now face a near-universal compliance obligation, not an optional skilling line item.
The system is also expanding. A September 2025 notification extended the Apprentices Act, 1961 to more industries, and the Central Apprenticeship Council has signed off on a CPI-linked, biennial stipend revision mechanism. Here’s where the law, the money and the mechanics stand today.
The Legal Framework Every HR Team Starts With
The Apprentices Act, 1961 and the Apprenticeship Rules, 1992 remain the governing statute, with the Apprenticeship (Amendment) Rules, 2025 as the latest overlay. The Act defines who can engage apprentices, the ratio band they must engage, the minimum stipend payable, and the penalties for non-compliance.
It also keeps apprentices legally distinct from employees. That carve-out means EPF, ESI, gratuity, and the Factories Act leave provisions don’t apply to them.
Who’s Covered, Who’s Optional
Workforce count is the first filter, and it’s inclusive of contract staff but excludes apprentices themselves. The thresholds decide whether an establishment can engage apprentices at all, whether it may do so voluntarily, and whether the Act compels it to.
| Workforce (including contract staff) | Status Under the Act |
| Fewer than 4 workers | Not permitted to engage apprentices |
| 4 to 29 workers | Voluntary engagement |
| 30 or more workers | Mandatory engagement (Section 8) |
Mandatory establishments must engage apprentices in a band of 2.5% to 15% of total workforce in a financial year, with at least 5% of that reserved for fresher and skill-certificate-holder apprentices. The monthly count can’t fall below 2% or rise above 18% of total strength.
NAPS and NATS: The Two Parallel Schemes
Apprenticeship engagement in India runs through two Central Sector schemes that overlap in intent but differ in sponsor, target group and funding share. Both operate under the same statute, but the paperwork, portals and nodal ministries diverge.
| Feature | NAPS (PM-NAPS) | NATS |
| Nodal ministry | Ministry of Skill Development and Entrepreneurship | Ministry of Education |
| Primary target | Trade apprentices, freshers, skill certificate holders | Graduate and technician apprentices |
| Government share of stipend | ₹1,500 or 25% of stipend | 50% of stipend |
| 2025 engagement | 11.84 lakh | 5.23 lakh |
NAPS is the larger of the two by volume. From 2022-23 to June 2026, over 47.5 lakh apprentices have been engaged under NAPS across more than 45 sectors, with the government’s share of stipend disbursed totalling ₹1,609.19 crore.
The New Stipend Floor After September 2025
The Apprenticeship (Amendment) Rules, 2025, notified through Gazette G.S.R. 610(E) and effective 11 September 2025, raised the minimum stipend across every category of apprentice. The revised rates apply to new engagements and to apprentices already in training on that date, with portal-level back-calculation handling the transition for ongoing contracts, per the MSDE Office Memorandum of 15 September 2025.
| Period | Minimum Stipend Range (₹/month) |
| Before 11 September 2025 | 5,000 to 9,000 |
| From 11 September 2025 | 6,800 to 12,300 |
The range runs from school pass-outs at the entry end to graduate and degree apprentices at the top. The Central Apprenticeship Council has also cleared a mechanism to link future revisions to the Consumer Price Index, with automatic updates every two years timed to the July salary cycle, as recorded in the Lok Sabha response of 21 July 2025.
During the Basic Training phase of up to three months, “fresher” apprentices receive a reduced stipend, after which they receive the full rate.
Employer Obligations the HR Team Owns
Section 9 of the Act sets out the practical obligations an employer carries, and Section 30 sets out the penalties for missing them. The portal layer sits on top: registration on the Apprenticeship India Portal, contract execution, and stipend payment via Direct Benefit Transfer into the apprentice’s bank account.
The non-negotiables for a covered establishment include:
- Registering on the Apprenticeship India Portal and declaring workforce strength
- Entering into a written apprenticeship contract and uploading it on the portal
- Providing practical training per the programme approved by the Apprenticeship Adviser
- Deploying qualified instructional staff, or supervisors certified in the trade
- Paying a stipend monthly, via the apprentice’s bank account, no less than the notified minimum
- Granting the same safety equipment and welfare protections as regular workers
- Allowing the Apprenticeship Adviser or authorised officers to inspect training and test apprentice work
Penalties under Section 30 continue to apply until the employer regularises its position. Audits typically catch three recurring pressure points: treating apprentices as cheap substitute labour, cutting training content, and paying below the floor. These sit within the wider set of employment arrangements Indian employers manage, each with its own compliance footprint.
Where the System is Leaking
Policy ambition and ground reality diverge sharply. Dropouts under NAPS have risen roughly 15x in five years, outpacing both enrolment and completion growth. In FY21, nearly 70% of apprentices completed training; by FY26, that fell to just over 50%. Applications to NAPS vacancies fell to a six-year low in 2025, even as public sector banks alone issued over 25,000 apprenticeship notifications in H1 2026.
NITI Aayog’s February 2026 report, “Revitalising India’s Apprenticeship Ecosystem“, traces the gap to several structural issues: fragmented data between NAPS and NATS, awareness gaps among young job-seekers, uneven stipend levels across sectors, and completion certificates with weak signalling value in the labour market. Employers add their own list: the paperwork load, the mismatch between notified trades and emerging job families, and a thin pipeline of accredited basic-training providers.
What Indian Employers Are Actually Doing
Compliance patterns vary sharply by sector. Public sector banks, Indian Railways, PSU manufacturing, and large private manufacturers run the deepest apprenticeship pipelines in the country, with some absorbing a share of apprentices into full-time roles on completion.
Visible examples include:
- State Bank of India (7,150 apprentice vacancies in 2026), Punjab National Bank (5,138) and Bank of Baroda (5,000) treat apprenticeship as a core entry-level pipeline
- Tata Steel, Maruti Suzuki and Larsen & Toubro run multi-year programmes that combine trade apprentices under the Act with graduate and technician apprentices under NATS
- IT services firms engage apprentices largely under NATS, through the degree apprenticeship route linked to the Apprenticeship Embedded Degree Programme notified in 2026
- Mahindra’s upcoming skilling centre tied to the Nagpur mega plant wires basic training directly into the group’s own hiring funnel
The common thread across the serious programmes is treating apprenticeships as a feeder, not a cost line. Mapping notified trades to actual workforce plans, timing basic training before peak production cycles, and tracking conversion-to-hire as the real KPI, instead of stipend reimbursement, is what separates them. It also pulls apprenticeship into the same conversation as a company’s broader campus hiring strategy and its structured youth internship and skilling programmes.
In the End…
The Act is now a near-universal compliance surface for anyone running an establishment of 30 or more. The practical move for HR is to audit the current workforce count, including contract staff, against the 2.5% to 15% band, pull the Apprenticeship India Portal registration status, and map notified trades onto roles the business actually hires for.
From there, the revised stipend floor and the CPI-linked future revisions set the budget line. Pairing that with a conversion target measured monthly turns apprenticeship from a reporting obligation into the entry-level pipeline it was built to be.
FAQs
What is the Apprentices Act, 1961?
The central statute governing apprenticeship engagement in India. It defines who can engage apprentices, the ratio band employers must maintain, the minimum stipend payable, and penalties for non-compliance.
Which establishments must engage apprentices?
Any establishment with 30 or more workers, including contract staff, is covered under Section 8. Units with 4 to 29 workers can engage apprentices voluntarily, while those with fewer than 4 are not permitted to.
What is the apprentice-to-workforce ratio prescribed under the Act?
Mandatory establishments must engage apprentices in a band of 2.5% to 15% of total workforce in a financial year. At least 5% of that quota is reserved for freshers and skill-certificate holders.
What is the minimum stipend for apprentices in India?
From 11 September 2025, the minimum stipend range is ₹6,800 to ₹12,300 per month, up from the earlier ₹5,000 to ₹9,000 band. Rates vary by apprentice category, from school pass-outs to graduate apprentices.
How are NAPS and NATS different?
NAPS, under the Ministry of Skill Development, targets trade apprentices and freshers with a government stipend share of ₹1,500 or 25%. NATS, under the Ministry of Education, covers graduate and technician apprentices with a 50% stipend share.
Are apprentices entitled to EPF, ESI and gratuity?
No. The Act keeps apprentices legally distinct from employees, so EPF, ESI, gratuity and Factories Act leave provisions do not apply to them. They are, however, entitled to the same safety equipment and welfare protections as regular workers.
What are the penalties for non-compliance?
Section 30 of the Act applies penalties for failures such as under-engagement, paying below the stipend floor, cutting training content, or treating apprentices as substitute labour. Penalties continue to apply until the employer regularises its position on the Apprenticeship India Portal.
