Consultancy

Investments/ Recent developments.

The total amount of Foreign Direct Investment (FDI) inflow into the education sector in India stood at US$ 3 billion from April 2000 to December 2019, according to data released by Department for Promotion of Industry and Internal Trade (DPIIT).

The education and training sector in India has witnessed some major investments and developments in the recent past. Some of them are:

• In January 2020, Harappa Education raised an undisclosed amount from James Murdoch-led Lupa Systems in a funding round.
• In February 2020, Unacademy has raised a US$ 110-million Series E round from Facebook and General Atlantic.
• In August 2019, Maharashtra International Education Board (MIEB) has signed a collaboration agreement with Google for Education in India.
• In October 2019, IIT Madras reached agreement with ExxonMobil Research and Engineering Company (EMRE) for research on Energy and Biofuels.
• In July 2019, Qatar sovereign fund led an investment round of US$ 150 million in Byju’s.
• As of March 2019, the Government of India is taking the initiative to encourage colleges to offer online courses in rural areas to ensure education for all.
• As of March 2019, there are 66 million internet subscribers in India in age bracket of 5 to 11 years.
• In August 2019, Vision Digital has launched a course with the goal to bring digital education to 1 lakh students in upcoming years, this course will equip the youth with digital and analytical skills.

• Indian education sector witnessed 18 merger and acquisition deals worth US$ 49 million in 2017.
• Of all the startups in India, 3,500 are catering to the education space. These startups received close to US$ 700 million funding in 2018.
• The Ministry of Human Resource Development, Government of India is also planning to raise around Rs 1 lakh crore (US$ 15.52 billion) from private companies and high net worth individuals to finance improvement of education infrastructure in the country.
• India has signed a loan agreement with World Bank under ‘Skills Acquisition and Knowledge Awareness for Livelihood Promotion’ (SANKALP) Project to enhance institutional mechanisms for skills development.
• Singapore is going to open its first skill development centre in Assam, which will provide vocational training to youth in the region.

Government Initiatives

Some of the other major initiatives taken by the Government of India are:

• According to the Union Budget 2020-21, government allocated Rs 59,845 crore (US$ 8.56 billion) for Department of School Education and Literacy.
• Revitalising Infrastructure and Systems in Education (RISE) by 2022 was announced and in Union Budget 2020-21 an outlay of Rs 3,000 crore (US$ 429.55 million) was proposed.
• Under Union Budget 2020-21, government proposed apprenticeship embedded degree/diploma courses by March 2021 in about 150 higher educational institutions.
• In November 2019, the India Design Council (IDC) launched the Chartered Designs of India (CDI) and the Design Education Quality Mark (DEQM).
• In October 2019, the Ministry of Skill Development and Entrepreneurship (MSDE) signed an agreement with the Indian Institute of Management (IIM) Bangalore for introducing a two-year fellowship programme Mahatma Gandhi National Fellowship (MGNF) programme.
• In October 2019, NCERT added in curriculum that for pre- schoolers teaching will be in Mother tongue and no homework for them.
• As on February 2020, 254,897 training centers are registered in India and around 2 crore candidates have completed training under the Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA).
• The Government has allocated the expenditure budget for higher education Rs 38,317 crore (US$ 5.4 billion) and for school education and literacy of Rs 56,536 crore (US$ 8.08 billion).
• Government provided Rs 400 crore (US$ 51.23 million) for ‘World Class Institutions’ for FY 2019-20.

• Government promoted new scheme ‘Study in India’ to bring foreign students to higher educational institutions.
• In August 2018, Government of India launched the second phase of ‘Unnat Bharat Abhiyan’ which aims to link higher educational institutions in the country with at least five villages. The scheme covers 750 such institutions.
• The allocation for school education under the Union Budget 2018-19 is expected to increase by 14 per cent, to focus on accelerating existing schemes and quality improvement.
• In order to boost the Skill India Mission, two new schemes, Skills Acquisition and Knowledge Awareness for Livelihood Promotion (SANKALP) and Skill Strengthening for Industrial Value Enhancement (STRIVE), have been approved by the Cabinet Committee on Economic Affairs (CCEA), Government of India, with an outlay of Rs 6,655 crore (US$ 1.02 billion) and will be supported by the World Bank.
• The Ek Bharat Shreshtha Bharat (EBSB) campaign is undertaken by Ministry of Human Resource Development to increase engagement between states, union territories, central ministries, educational institutions and general public.
• Prime Minister Mr Narendra Modi launched the Skill India initiative – ‘Kaushal Bharat, Kushal Bharat’. Under this initiative, the government has set itself a target of training 400 million citizens by 2022 that would enable them to find jobs. The initiatives launched include various programmes like: Pradhan Mantri Kaushal Vikas Yojana (PMKVY), National Policy for Skill Development and Entrepreneurship 2015, Skill Loan scheme, and the National Skill Development Mission.

Government Achievements

Following are the achievements of the government in the past four years:

• Central Board of Secondary Education (CBSE) introduced artificial intelligence as a subject in class ninth from the session 2019-20.
• In August 2019, Maharashtra International Education Board (MIEB) has signed a collaboration agreement with Google for Education in India.

• Under the mid-day meal scheme initiated by the Government of India, about 95 million students of around 1.14 million schools enjoy fresh meal every day.
• The Government has laid foundation of 141 universities and 7 IITs in the past four years.
• With an aim of promoting innovation and entreprenuership among secondary school students in the country NITI Aayog, Government of India has launched the Atal Innovation Mission (AIM)In June 2018, 3,000 additional Atal Tinkering Labs were approved, taking the total number of labs to 5,441.

Road Ahead

In 2030, it is estimated that India’s higher education will:

• The combination training method, that involves online learning and games, is expected to grow by up to 38 per cent in the next 2-4 years.
• In private equity and venture capital funding, education industries companies to attract US$ 500 million by end of 2019.

• Adopt transformative and innovative approaches in Higher education.
• Have an augmented Gross Enrolment Ratio (GER) of 50 per cent
• Reduce state-wise, gender based and social disparity in GER to 5 per cent.
• Emerge as a single largest provider of global talent, with one in four graduates in the world being a product of the Indian higher education system.
• Be among the top five countries in the world in terms of research output with an annual R&D spent of US$ 140 billion.
• Have more than 20 universities among the global top 200.

Various government initiatives are being adopted to boost the growth of distance education market, besides focusing on new education techniques, such as E-learning and M-learning.

Education sector has seen a host of reforms and improved financial outlays in recent years that could possibly transform the country into a knowledge haven. With human resource increasingly gaining significance in the overall development of the country, development of education infrastructure is expected to remain the key focus in the current decade. In this scenario, infrastructure investment in the education sector is likely to see a considerable increase in the current decade

Moreover, availability of English-speaking tech-educated talent, democratic governance and a strong legal and intellectual property protection framework are enablers for world class product development, as per Mr Amit Phadnis, President-Engineering and Site Leader for Cisco (India).

The Government of India has taken several steps including opening of IIT’s and IIM’s in new locations as well as allocating educational grants for research scholars in most government institutions. Furthermore, with online modes of education being used by several educational organisations, the higher education sector in India is set for some major changes and developments in the years to come.

Note: Conversion rate used as on January 2020, Re 1 = US$ 0.01402

References: Media Reports, Press Releases, Press Information Bureau, RNCOS Report, Department for Promotion of Industry and Internal Trade (DPIIT), Union Budget 2019-20