Since independence, attempts were made to increase the contribution of manufacturing sector and to exploit the potential of job creation. The fast pace of economic growth in the post liberalization era has necessitated skilled workforce that could effectively participate as well as lead the country's growth story. With the view to fully exploit the growth potential of various sectors, there is a need to develop a skilled workforce that possesses the required competence and skills to be able to take up jobs generated in various sectors. Skilling India's youth is the need of the hour as it is the only way by which we can utilize the tremendous power of human resources available to us in the form of young population.

In this paper the researcher has tried to analyse the issues/challenges involved in skill development in India such as skill gaps, issue of demographic dividend, absence of common standards and common curriculum and other challenges etc. An attempt has also been made to understand the national skill development policy and to provide necessary suggestions in the form of adoption of technology in education, introduction of: skill university model in whole of India, women- oriented programmes, innovative policies like scholarships, rewards and skill vouchers to fund poor students, making availability of study material in local languages etc., so as to overcome the challenges.