EPFO EO/AO 2023 General Ability Test · Question 109 of 120

Correct — B, (b) 2 only. Read the ask before anything else. This question does not ask which statements are correct; it asks which are not correct, and the word not is printed in bold italics in the booklet precisely because the whole item turns on it. The four code options therefore mean: (a) statement 1 alone is faulty, (b) statement 2 alone is faulty, (c) both are faulty, and (d) neither is faulty, which is to say both are correct. The answer is (b), so statement 2 is the faulty one. Statement 2 says the National Skill Development Corporation promotes skill development by catalysing the creation of only large, quality and non-profit vocational institutions. Two words have been altered from NSDC's own mandate, which is to promote skill development by catalysing the creation of large, quality and for-profit vocational institutions. The decisive change is non-profit for for-profit, and it inverts the whole design of the body. NSDC is itself a not-for-profit company, but the entire point of the model is that it uses public money as patient capital to bring commercial, profit-seeking training enterprises into vocational education, on the reasoning that only a business with a stake in placement outcomes will scale and sustain training. The second alteration is the word only, which shuts the door on everything else NSDC funds and supports. Either change alone would make the statement wrong; together they leave no room for argument. Statement 1 says NSDC is a not-for-profit public limited company set up by the Ministry of Skill Development and Entrepreneurship, and the key treats it as correct. The legal-form half is exactly right: NSDC was incorporated on 31 July 2008 as a not-for-profit public limited company under section 25 of the Companies Act, 1956, which corresponds to section 8 of the Companies Act, 2013. On the ministry, NSDC works under the Ministry of Skill Development and Entrepreneurship, which holds 49 per cent of its share capital while private-sector shareholders hold the remaining 51 per cent, the split that makes it a public-private partnership. Note in passing that the phrase not-for-profit in this statement is part of a legal description and is not a negation; it is not the word the ask turns on. So one statement is faulty and it is the second, which is option (b).

• (a)1 only — This says statement 1 is the faulty one and statement 2 is sound, which reverses the item. Statement 2 cannot be sound: NSDC's mandate is to catalyse large, quality and for-profit vocational institutions, and a statement that turns for-profit into non-profit contradicts the founding idea of the body rather than merely mis-stating a detail. Meanwhile the description in statement 1, of a not-for-profit public limited company working under the skill development ministry, matches what NSDC is. The option is a trap for a candidate who has spotted that NSDC is itself not-for-profit and has therefore concluded that its purpose must be to create non-profit institutions too. The opposite is the case, and holding those two facts side by side is the single most useful thing to remember about this body.
• (c)Both 1 and 2 — The Commission's key does not take this option, and the card teaches statement 1 as correct because that is how the key grades it. It is worth being precise about where a careful candidate might hesitate. NSDC was incorporated in 2008 as a public-private partnership under the Ministry of Finance, and the Ministry of Skill Development and Entrepreneurship was itself created only in November 2014, so the words 'set up by' are loose if read as a claim about who founded it in 2008 rather than about the ministry it belongs to. NSDC's own and the Government's current descriptions place it under that ministry, which holds 49 per cent of its equity, and the key accepts statement 1 on that reading. The discriminating error the question is built around is the one in statement 2, and it is unambiguous.
• (d)Neither 1 nor 2 — On a question asking which statements are not correct, this option asserts that neither is faulty, that is, that both are correct. It fails on statement 2, whose description of NSDC's purpose reverses the for-profit element of the mandate and adds a restriction to large institutions only. The option is also the classic casualty of the inverted ask: a candidate who reads the stem as though it said 'which are correct', decides that statement 1 is right and statement 2 is wrong, and then looks for '1 only' can also arrive here by a second slip. The defence is to write the ask down in words before touching the options, so that 'not correct' stays visible while the statements are being judged.

The National Skill Development Corporation is the delivery vehicle of India's skilling policy and an unusual institution in its design. It was incorporated on 31 July 2008 as a not-for-profit public limited company under section 25 of the Companies Act, 1956, now section 8 of the Companies Act, 2013, as a public-private partnership: the Government, through the Ministry of Skill Development and Entrepreneurship, holds 49 per cent of the share capital and private-sector shareholders hold 51 per cent. Its mandate is to promote skill development by catalysing the creation of large, quality and for-profit vocational institutions, and it pursues that by funding training providers through equity, loans and grants, by supporting the Sector Skill Councils that write occupational standards for each industry, and by acting as the implementing agency for the Government's flagship skilling programmes. The design rests on a deliberate separation: the corporation itself takes no profit, while the training enterprises it seeds are expected to be commercially viable, so that the training market can grow beyond what a grant-funded system could support. Around it sits the wider architecture of the skilling ecosystem, which includes the Ministry of Skill Development and Entrepreneurship created in November 2014, the National Skill Development Mission launched in July 2015, the National Council for Vocational Education and Training as the regulator, the Directorate General of Training and the Industrial Training Institutes, and the National Skills Qualifications Framework, which places every qualification on a common ladder of levels.

The EO/AO General Ability Test devotes a whole block to governance, economy and government schemes, and bodies like NSDC are examined by their institutional attributes: legal form, ownership, parent ministry and mandate. This item is built on the neatest possible discrimination, which is a body that is itself not-for-profit but whose purpose is to create for-profit institutions. That is the kind of apparent contradiction examiners look for, because a candidate who has only skimmed will assume the two must match. The habit rewarded is to hold, for every such body, a short card of four items: what kind of entity it is, who owns it, which ministry it answers to, and what it was set up to do.

• NSDC was incorporated on 31 July 2008 as a not-for-profit public limited company under section 25 of the Companies Act, 1956, now section 8 of the Companies Act, 2013.
• It is a public-private partnership: the Government holds 49 per cent of the share capital through the Ministry of Skill Development and Entrepreneurship, and the private sector holds 51 per cent.
• Its mandate is to promote skill development by catalysing the creation of large, quality and for-profit vocational institutions.
• It funds training providers through equity, loans and grants, and supports the Sector Skill Councils.
• The corporation itself is not-for-profit, while the institutions it seeds are meant to be commercially viable; that contrast is the point of the model.
• The Ministry of Skill Development and Entrepreneurship was created in November 2014, six years after NSDC was incorporated.
• The National Skill Development Mission was launched in July 2015; the National Council for Vocational Education and Training is the regulator.

• Missing the inverted ask; this is the only question in this part of the paper that asks which statements are not correct.
• Assuming that because NSDC is not-for-profit the institutions it promotes must be non-profit as well.
• Overlooking the word 'only' in statement 2, which narrows the mandate even apart from the for-profit reversal.
• Reading the phrase 'not-for-profit' as the negation the ask turns on; it is part of a legal description.
• Confusing NSDC with the Ministry that oversees it or with the National Skill Development Mission, which is a separate instrument.

Institutions of this kind come up in EO/AO papers as two-statement code items testing legal form and mandate, as single-line questions about the parent ministry, and occasionally as matching items pairing bodies with the year they were set up. A large share of them are framed negatively, so the first discipline is to identify the ask. Build the four-item card for each body, and pay special attention to institutions whose own legal form differs from the character of what they are meant to create, because that mismatch is exactly what a question like this is built on.

No directly related past PYQ was found.

• practice — not a real PYQ

  With reference to the National Skill Development Corporation, which one of the following statements is correct ?

  • (a)It is a department of the Ministry of Skill Development and Entrepreneurship
  • (b)It is a not-for-profit company in which the Government holds 49 per cent of the share capital
  • (c)It is a statutory regulator that awards vocational qualifications
  • (d)It is a wholly Government-owned public sector undertaking

  Answer(b) It is a not-for-profit company in which the Government holds 49 per cent of the share capital

• practice — not a real PYQ

  Which one of the following was set up as the regulator for vocational education and training in India ?

  • (a)National Skill Development Corporation
  • (b)National Council for Vocational Education and Training
  • (c)Sector Skill Councils
  • (d)Directorate General of Employment

  Answer(b) National Council for Vocational Education and Training