Skills and knowledge drive economic growth and social development of a country. Nations with higher levels and better standards of skilled workforce can deal with challenges and opportunities in the domestic and global market. India is one of the fastest-growing economies in the world. It is currently celebrating demographic dividend with two-third of 1.3 billion people under the age of 30 years. However, a big challenge lies ahead as estimates show that India has a very few skilled labour force. According to Organisation of Economic Cooperation and Development (OECD), over 30% of the youth aged between 15 to 29 years are ‘not in employment’ which refers to those who are not searching for jobs either due to unavailability or there are no jobs that match their skills. Despite the government’s initiatives to promote jobs, unemployment is turning out to be a new norm. This is because India is facing challenges at many levels. Skill India, that seeks to improve the skills of the Indians, is showing very limited results. This is because of the limitations that exist within the various government initiatives. It is necessary to address these issues so that India can become a $5 trillion economy.