When ‘opportunity’ becomes free labour: India’s apprenticeship and internship paradox

free labour pipelines, with weak obligations on employers, minimal accountability for skill transfer, and no credible pathway to stable employment.

In healthcare, nursing staff, lab technicians and medical interns—particularly in private hospitals—have long functioned as an underpaid, overworked training cohort, performing essential clinical labour under the guise of “learning” or “service”. Despite being central to patient outcomes and hospital continuity, nurses and interns are often excluded from fair wage structures, welfare protections, and clear career progression using the ‘trainee’ label.

The legal grey zone that enables exploitation

Indian labour law does not define “interns” or “trainees” at all. These terms exist in practice, not statute. They are typically used for students or young jobseekers acquiring “practical exposure”, and may be paid or unpaid, with or without explicit promises of post-training employment. Such a stint may also be performed for academic credit requirements. Because such roles are not recognised categories, interns fall outside the protections of minimum wage laws, provident fund, social security, or formal grievance redressal mechanisms.

The closest legal analogue is the Apprentices Act, 1961, which applies mandatorily to establishments with 30 or more workers and requires them to engage apprentices in specified proportions. The Act is, on paper, robust. It mandates registered apprenticeship contracts, defined training hours, minimum stipends, qualified trainers, reserved positions for SC, ST, and OBC candidates, and even compensation if the employer breaches the contract. Non-compliance can attract fines and (though it has been recently repealed) imprisonment as well.

But the Act also explicitly treats apprentices as non-employees. They are excluded from most labour welfare legislation, including provident fund coverage. In practice, enforcement is weak, monitoring is thin, and penalties are modest enough to be treated as a cost of doing business. For smaller firms, the compliance burden often discourages genuine apprenticeship programmes altogether. For larger ones, apprenticeships become a revolving door: apprentices are trained, deployed for entry-level work, and released—only to be replaced by the next batch.

Internships outside the Apprentices Act are even more precarious. Regulatory guidance from the EPFO (Employees’ Provident Fund Organisation) makes clear that only student-trainees whose training is an integral part of a recognised course, time-bound, and limited in number can safely be excluded from an employment relationship. The moment interns are used for core, revenue-generating work under employer supervision, the risk of misclassification arises. Indian courts have repeatedly shown willingness to “lift the veil” and look at substance over nomenclature. Trainees doing regular work have been granted gratuity and welfare benefits despite being labelled otherwise. It is possible that trainees may engage in exploratory R&D for the firm, for periods as long as six months or one year as per their academic degree programmes, but may not have any equity in the outcome beyond a stipend.

Yet litigation is the exception, not the rule. Most young workers lack the resources, time, or confidence to challenge misclassification.

From skills to jobs or from jobs to skills?

The deeper malaise is not just legal ambiguity but a political economy that has reframed unemployment as a skills problem.

Over the last decade, India’s employment crisis—marked by rising informalisation, stagnant real wages, and shrinking public sector recruitment—has been narratively converted into a deficit of “employability”. Young people are told, repeatedly, that jobs exist, but they lack the right skills. The solution, therefore, is skilling, reskilling, and upskilling – sometimes in a mindless cycle.

This logic animates the vast skilling infrastructure of the country: nearly 15,000 ITIs, short-term vocational courses, apprenticeship mandates, and flagship schemes under Skill India. Official claims boast of crores being “skilled”. What they rarely track is how many secure jobs are created at the end of this pipeline.

Field accounts from ITIs across Assam, Odisha, Gujarat, and Bihar tell a different story. Students enrolling in fitter, electrician, diesel mechanic, or COPA (Computer Operator & Programming Assistant) trades are not naïve. They know that social mobility is fragile, that agriculture is no longer viable, and that informal work offers little dignity. Many hold university degrees already in anticipation of government jobs. They come to ITIs because they are told—by counsellors, principals, politicians—that practical skills are the gateway to employment.

What they find instead is a bottleneck. Placement rates are low. Wages offered through apprenticeships often hover between Rs 8,000 and Rs 10,000 a month, or less, as in the PM Internship Scheme—barely enough to survive away from home. Apprenticeships rarely convert into permanent jobs; at best, they lead to short-term contracts. Employers, including large industries, rotate apprentices continuously to keep labour costs down. Even government employment has moved towards short contracts and fixed tenures, possibly in anticipation of bribes for hiring officials or quid-pro-quos for hiring ruling party cadres.

An ITI principal in Odisha puts it bluntly: why would a young person migrate to another district for Rs 12,000 when they can earn the same as a daily wage worker closer home? The “unwillingness” of youth to move is not laziness; it is economic rationality.

Apprenticeship as cost arbitrage

Here is where the Indian story converges with the British one. In both contexts, state-funded or state-mandated training mechanisms are being used to subsidise employers, not entrants.

In the UK, levy funds are diverted to expensive executive programmes rather than youth training. In India, the cost of entry-level labour is socialised through stipends, exemptions from labour law, and the moral pressure placed on youth to accept “learning opportunities”. Apprenticeship, originally conceived as a bridge from education to employment, increasingly functions as a buffer stock of disposable labour, with no check on repetitive hiring within group companies.

This is especially troubling given the social composition of skilling institutions. Historically, vocational and industrial education in India has been closely tied to caste and class hierarchies. Technical education for elites coexisted with industrial training for the masses. That legacy persists. ITI students today are disproportionately from marginalised backgrounds. The promise of skilling is often the only state-endorsed pathway offered to them.

Yet even as aspirations are raised, outcomes are structurally capped. Engineers become supervisors; ITI graduates remain blue-collar workers with confiscated phones, separate uniforms, and little upward mobility. Tailoring courses in villages where everyone is trained to stitch but no one can sell may not add up to empowerment.

Accountability without outcomes

What is striking is how little accountability exists for learning outcomes. There is no standardised, credible system to certify what an intern or apprentice has actually learned across firms. Progress records exist on paper, but rarely translate into portable credentials valued by employers. Credit migration frameworks are talked about much, but seem mostly to work in high-brow ECTS (European Credit Transfer and Accumulation System) exchange programmes for MBAs and the like. Unlike degrees, these experiences are hard to signal in the labour market.

The result is a cruel paradox. Young people are told that skills are the answer, but the skills they acquire are neither scarce nor rewarded. They move from degree to diploma to certificate to apprenticeship, accumulating experience without stability. As one ITI student put it: “Why are we made to go from one degree to another?”

Towards a more honest compact

None of this is an argument against apprenticeships, internships, or skilling. Properly designed, they are essential. But honesty demands that we ask harder questions like:

a. If internships are educational, what exactly is being taught, how, and how is it assessed?

b. Why is a firm’s intended proportion of converting apprentices to employees not announced during in-campus placement the way firm offer-letters are?

c. If skills are the binding constraint, why have real wages stagnated despite rising education levels?

d. As we migrate towards a consumption-led economy, which internships or apprenticeships meaningfully evaluate the sales or managerial aptitude of new hires?

Policy must move beyond targets and enrolments to outcomes and transitions. That means clearer legal definitions of interns and trainees, minimum standards for stipends and duration, enforceable learning plans, and transparent reporting of post-training employment. It also means confronting the uncomfortable truth that no amount of skilling can substitute for job creation.

A country with a young population cannot afford to treat its youth as a holding pattern—kept busy, hopeful, and endlessly “training” while secure employment contracts shrink.

Apprenticeship should be a promise of mastery and belonging, not a euphemism for cheap labour. The cost is not just economic, but also generational trust.

DISCLAIMER: The views expressed are solely of the author and does not necessarily subscribe to it. will not be responsible for any damage caused to any person or organisation directly or indirectly.