India’s education sector, currently pegged at over Rs 6.4 lakh crore, has a tremendous potential for growth due to the huge demand-supply gap, says a recent report by India Ratings and Research.

Quantifying the gap, the report says that there is an additional requirement of over 2 lakh schools, 35,000 colleges, 700 universities and about 40 million seats in India’s vocational training centres. The report believes education sector’s size to reach over 7.80 lakh crore by FY17. Appreciating the policy support of the present government to augment the quality of education both in schools and in institutes of higher learning, the report, however, remains deeply concerned about the rising teacher-pupil ratio especially at the primary and secondary level of education.

“What is more worrying is that this ratio is not uniform across the board,” says Sunil Sinha, principal economist, India Ratings & Research.

Sinha adds that the teacher-student ratio is particularly adverse in government schools. India has always had an adverse teacher-student ratio but it has also aggravated due to non-appointment of teachers. Besides this high ratio, there is a problem of qualified and skilled faculty.

The government is sincerely trying to reorient the entire education system towards creating the awareness and impart those skills that are required in a highly competitive modern economy. Education sector is receiving more policy support in the form of a rise in budgetary allocations, setting up of boards to evaluate the standards of schools and colleges, teacher training initiatives, but “the kind of financial support that the system requires might not all be provided by the government alone,” says Sinha.

To mitigate this gap the role of private participation is also growing. As per the Ministry of Human Resources, the share of state private universities out of the total universities in India spiked to 29% in FY15 from around 3% in FY09. Analysts believe that there is a significant incentive for opening up state private universities in the absence of any regulatory cap on the approved intake for students, which has a positive bearing on the functioning of such universities.

More international collaborations with education institutions along with joint ventures and merger and acquisitions with both foreign and domestic corporate players would further help the sector to grow.

Sinha welcomes the role of private participation but expects the government to ensure that education remains affordable to the masses. A proper regulatory oversight without creating much of the friction is the need of the hour.


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