Indian education market demands USD 100 billion investments: report

EduShine Academic Search

education awards“India is the one of the most emerging education market especially due to the upcoming generation who is willing to explore more and secondly due to the demographic dividends.

However there exist certain gaps which are to be filled by government and private entities in order to sustain the overall ecosystem,” stated, Amit Gupta, Chairman, Education Committee, PHD
Chamber of Commerce & Industry.

“Education sector should also be prioritized in a similar manner as Infrastructure sector, thereturn on education should be good, and government should work on the tax incentives of education. And also I believe that Government should spend high on sustaining and developing the common education across Tier 2, 3 and 4 cities,” Gupta added.

“Indian Education Investment Report 2013”, was released at the third edition of Indian EducationCongress. The report brings forth the persisting gaps changing consumption patterns, demographical investments and business opportunities existing in the current Indian education sector.

Prof Parvin Sinclair, Director, NCERT stated, “Indian Education System is evolving right from theRTE act (Right to Education) that enacted in 2010, according to which schools were liable to provide 25 percent of Grade – 1 education to underprivileged children. Schools were accountable to implement this policy latest by 2012, however the implementation on this act has not been made extensively across states. I believe the private and government entities should make efforts to sustain the overall Education System.”

“The need to reform the Indian education system has become very prominent in past few years.To keep pace with the fast moving world of education there are a lot of aspects that the Indianeducation has to focus on. The Indian Education Congress has successfully covered as manyaspects as possible, which could be fruitful if and when induced in our current education system” stated Gaurva Marya, Chairman, Franchise India.

According to the report the education market in India currently stands at a whopping YoY growthof 15 percent. However there is a further demand of investments to the tune of USD 100 billion for construction and provisioning of education facilities especially in K – 12 and higher education segments.

The current spending on Education stands at INR 1035 per month for an urban household and INR 293 for a rural household however consumers are willing to spend even higher spends if given access to quality education and this has brought players to the forefront. Likewise the private sector is rapidly spreading its horizon in the Education market and currently accounts for 48 percent of its total revenue. Realizing the pertinence of Private sector to uplift Indian Educationthe government has launched Public – Private Partnership to invest in the Education market.

Besides being a regulated Industry in the formal sector to an extent the education Industry offersnumerous investment opportunities for prospective investors.The report highlights some of these opportunities and further elaborates the currentdemographical investments trends across different education segments such as Pre-Schools
Education, K- 12 Education, Higher Education, Vocational Training / Institutions.Pre-Schools Education Market largely unregulated, is set for a 26 percent growth over the nextfew years. This exemplifies the opportunities for education providers to enter Pre-School Education. Some of the new business opportunities existing in the Pre-School segment include Teacher’s training, inclusion of day care centers, provisioning of After-School extra-Curricular
activities and edutainment.

The K-12 market though regulated offers a number of opportunities especially in the informalsector such as automated learning platforms, integration of ICT in Classrooms, diversification ofInformation sector in formal K-12 market and integration of Pre-School education with primaryschooling. Higher education market is also flourishing with CAGR of 19 percent expected over thenext couple of years. Investments in the sector are likely to be made in setting up education hubs and incubation centers, expanding existing institutions, developing physical infrastructure, combining vocational education with mainstream education making alternative use of premises and e-learning. In terms of Vocational training the major prospective centers from an investment perspective seems to be Banking and Financial Services, Hospitality, IT / ITES and Beauty and Wellness.

Marya further shared his insights on the Market Scenario, “Indian education industry today owingto the high need of quality education, upsurging demand of employable human resource needs focussed investments in Indian education both by the private enterprise and government. The current industry stats depict that the industry will have 13-15 percent year-on-year growth and reach USD 100 billion mark by the year end. The private sector and the alternative methods of teaching are helping to transform the education system at all levels from Pre-K to post-
secondary. Among all the segments, private education stream has taken the lead which isgrowing at the rate of around 30 per cent and shares 48 percent of the total revenue stream.He further stated, “Also, the Early Education, K-12 and vocational education franchise chains are expanding their wings all across the country as well as abroad. Within the education sector, pre-school and child enhancement education services together have taken the lead in franchising witha significant share of 35 per cent. This is followed by professional skill-based education and vocational courses which carry the weight of 30 per cent of the educational franchise industry.There are more than 50,000 franchised education outlets.”