What Education Sector must deliver for India? Plus A Brief overview of Education sector scenario

Let’s imagine a few key features of Indian economy in 5, 10, 15 years from now

• In 5 years India will be the largest importer of Arms, Oil, Infrastructure goods and the remittances it receives from its exports must match its foreign exchange earnings. This requires an exportable skill based economy.

• In 10 years it will be the largest populated country of the world (1.396 billion) with a demographic make-up of world’s largest population of employable youth. Education system from now on must gear up to outcomes of employable, deployable, vocational skill certified, self employment capable / entrepreneurial pass outs.

• In 15 years most of India’s population will be urbanized and what worked for a country of 600,000 villages may not work anymore. This shall require the education sector to be boundary free (Local, State, Centre, Foreign, Private, Public) , flexi mode (online, distance, classroom, on the job), modular and integrated (a high school Plumbing certificate credits transferable to Diploma in Sanitation with credits transfers to specialization in Effluent plants or Degree in Civil engineering with a bridge course)

In view of the above key or representative trends,

What Education Sector must deliver for India?

In short - term (5 Years)

While a committee has been constituted under the Vice Chairman Planning Commission for a unified regulator, a few specific policies, norms, regulations to be addressed and successfully implemented

• A clear basic policy of the Govt. on education and a matching longer term vision.

• Policy reform in terms of recognizing and stating the role of “For profit” in education including clear role for entrepreneurs, corporates, foreign operators.

• Establishing a unified, independent Regulator empowered both to enforce regulation and to allow newer evolving / emerging or progressive models of education.

• Clear policy based impetus and incentives to Industry to contribute real and tangible resources for industry academia activities.

What Education Sector must deliver for India?

In mid- term (10 Years)

Develop in consensus with key stakeholders futuristic

• Assessment and certification norms.

• Accreditation criteria

• Ranking of various types of Institutions

• Teacher’s qualification and certification to allow various people from different walks of life to become teachers.

• Encourage global & domestic private operators to offer services in online, simulation, higher and vocational education, counseling & support services, merchant & shared services operations of infrastructure services including diversification opportunities to allied service providers (communication, media & entertainment, Retail & Logistic and supply chain operators) to leverage their infrastructure for skill up gradation, certification.

What Education Sector must deliver for India?

In longer term (15 Years)

• Work at a massive scale on employability and deployability aspects of education from secondary school onwards. Make summer training and industrial experience a vital part of education and live projects ongoing part of every curriculum.

• Vocational training push in every sector including in educational institutions. Bring in ‘viability’ in Vocational training business models with a supportive regulatory and certification model. Identify and allow hundreds of vocational training certifications and diplomas in all walks of futuristic living from Aviation & Space to Smart Cities and Internet of Things.

• Encourage and strengthen an ecosystem (ease of doing business, funding, regulatory compliances, social safety nets) for all kinds of entrepreneurship and self-employment opportunities at all academic stages.

• Large ticket public investment in “public urban infrastructure’ projects with bundled provision of setting up on site ‘rapid and mobile skill centres’ as part of licensing.

• Setting up of massive ‘Vocational Skill’ pool as an online “public (free access, no subscription) data bank” (may be as an offshoot of Aadhar) for ‘floating or part time’ hiring needs across geographies.

Brief overview of Education sector scenario

India, with around 650 million people in age group of 0-24 years, has a quarter of the total population in the world in this age bracket. Compared to China, the south Asian nation has the ability to pull global economy ahead not only directly by contributing to world GDP but also indirectly by providing skilled manpower. Over the next 15-20 years, all of the major world economies, including those in Asia, North America and Europe, will have much higher proportion of dependent population, challenging their ability to provide workforce for maintaining economic growth.

However, the outcome of India’s initiatives to transform its education system (primary, secondary, higher & Vocational) for producing larger number of literate, skilled and mobile workforce will be the most critical factor. PM constituting a committee, headed by Arvind Panagariya, NITI Aayog’s Vice Chairman, to suggest a framework for putting in place a new body subsuming AICTE, UGC, MCI etc. can be seen as a step in that direction. As an interim measure in this direction, the functions of MCI have already been taken over yesterday by a specially appointed committee headed by Justice RM Lodha.

Landscape of education sector in India

Today, India has around 450 million students studying in more than 48,000 education institutions. Size of Education sector was estimated to be $100 billion in 2015 of which private sector constitutes $95.8 billion. Gross Enrolment Ratio (GER) at various levels of education can be seen in the table below.

Higher Education: India with approximately 750 Universities & 39000 colleges has world’s biggest higher education (HE) set up and with 30 million enrollments in 2015 ranks second globally. In 2015, State private universities enrolled around 50% students, followed by State universities at 30% and Central Universities at 3%. Even with double digit growth in enrollment & capacity of HE in India, the quality of HE institutions have not kept pace. In 2010, 62% of Universities & 90% of colleges were rated below average by NAAC. It does not come as a surprise that Parliamentary committee on education & health have requested over haul of HE regulatory bodies such as AICTE, UGC, MCI.

While of the HE institutions those funded by Central government comprise only 6% of the total, the problem of quality & quantity of faculties at its premier institutions such as IITs, pervades the country’s entire HE system. IITs suffer from around 41% shortage in faculty, and as against prescribed teacher-student ratio of 1:10, they are struggling with a 1:17 ratio. Of the total, 45% are State Universities, 29% are state private Universities & 17% are Deemed Universities.

Curriculum, Content & Pedagogy are still not being addressed at a broader level and the use of IT for curriculum & pedagogy at a very large scale has been missing. In Pedagogy, the stress on making the student understand the application of the subject matter is missing. In most cases Lab sessions, though scheduled and gone through for the record, do not result in effective learning because it is not done in the right spirit. The problem is more of willingness at the faculty level than of the quality of infrastructure. The quandary has been that more autonomy for teachers in state universities leads to a lack of discipline in ensuring that classes are held, the labs are attended and completed by the students.

In his budget speech of FY 15-16, finance minister’s intent for using Massive Open Online Courses (MOOC) for Entrepreneurship Education and Training is a step in the right direction as India ranks 3rd in terms of number of people having access to internet even though this is merely 20% of the population.

Assessment & certification of skills of students are not standardized, as 15-18 million students take around 200 million examination at various higher education levels. Even within a domain different universities have different scales for measuring a skill set / knowledge for the same desired outcome!

Regulatory framework

Earlier in 2016, Niti Aayog had submitted to the Central Government a report making 12 recommendations around overall education setup in India. Major suggestions include building up of 10-20 world class institutions with adequate autonomy, setting of guideline to rationalize small schools for elementary education and introducing demand driven vocational courses in 15% secondary classes by FY17. Prior to this report the Parliamentary Standing Committee on Education raised questions over efficacy of AICTE & UGC while the Parliamentary Committee on Health had slammed MCI for failing to regulate medical education and the National Knowledge Commission had suggested formation of an autonomous Commission for Higher Education with experts as heads of different streams such as Technical Education, Health, Teacher Training etc.

Despite the above challenges, private HE institutions are expanding to tier 2/3 cities for a multi-city campus model. Last 5 years have witnessed M&A deals worth around $6 million in this space.

Vocational Training: 4.5 million students are studying at 18000 vocational training centres having an annual intake of 1.8 million. Polytechnic institutions & ITCs constitute 2250 & 7200 numbers respectively. Around 50% of vocational training students currently undergo training in Computer, Electrical & Electronics and Mechanical engineering domains. Another 20% are trained in skills related to textile, health & paramedical services and driving.

Having challenges of identifying a sustainable business model (non-MES / Govt. schemes), Vocational training companies are now transforming business models to make them more B2B heavy. In 2015, MetaScale and NIIT entered into an agreement to provide services in Big Data Analytics. Last 5 years has witnessed M&A deals worth around $19 million in this space.

National Policy on Skill Development and Entrepreneurship (2015) has replaced National Policy on Skill Development (NPSD), 2009. The new policy is country's 1st integrated national policy for developing skills and promoting entrepreneurship on a large scale and tries to address 4 key challenges to skilling, including low aspirational value, lack of integration with formal education, lack of focus on outcomes, low quality of training infrastructure and trainers.

At the K12 level (including preschools) 227 million students are there in 1.4 million schools (1.08 Govt. & 0.32 private) having annual intake of approx. 18 million students.

Competition is intensifying at K12 education as private chains are more aggressively adopting franchise & owned school model & as chains such as Kidzee & Eurokids are upscaling to full K12 format to optimize operations in face of relatively low enrolment traction. Last 5 years has witnessed M&A deals worth around $11 million in this space.

Dropout rates of girls have witnessed an increase in comparison to boys across primary & secondary level.

Most explosive growth of 25% is being witnessed in Pre-school as Pre-school chains are slowly penetrating the still virgin tier 2 & tier 3 space. Last 5 years has witnessed M&A deals worth around $8 million in this space.

The private tutoring space is witnessing unprecedented traction from the organized players with deals such as Meritnation raising $4.09 million and Toppr (a Mumbai based e-learning portal) raising $10.45 million. Last 5 years has witnessed deals worth around $18 million in this space.

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