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Posted on Nov 01, 06:56PM | IBNS
The Indian education space is evolving, which has led to the emergence of new niche sectors like vocational training, finishing schools, child-skill enhancement and e-learning among others. However, over the past few decades, the global economy has shifted from being manufacturing-centric to a knowledge-driven one.
In a report released by Deloitte Touche Tohmatsu India Private Limited titled, 'Indian Higher Education Sector: Opportunities aplenty, growth unlimited!' it is stated that success in leveraging knowledge and innovation that could contribute to hi-tech manufacturing and high value-added services is only possible with a sound infrastructure of higher education.
As per projections, the sector is expected to register a CAGR of 12pc from 2008 to reach a size of USD 31.47 bn.
The Government has set itself an aggressive target of doubling the GER in higher education from 15pc at present to 30pc by 2020.
As per estimates, to meet such a target huge investment will be required in terms of capital and operating expenditure which based on past experience Government would not be able to provide by itself.
The role of private sector in higher education has significantly increased in the last decade however due to various impediments the amount of FDI attracted by this sector since 2000 is dismally low at just USD 400 mn.
It is very important for foreign investment and experience to flow in this sector in order to transform our higher education institutions into the world's top league, said the report .
However, the report highlights the attractiveness of the higher education sector and the excellent opportunities it provides for Indian private and foreign investment even within the existing framework.
According to a Deloitte spokesperson, "The foreign education bill and other regulatory reforms when approved will be an icing on the cake. The investors need to wary about a unique set of challenges which present themselves while investing in this sector however they can be countered by innovative solutions."
Under the extant regulatory framework a number of innovative opportunities exist for Indian private and foreign sector players.
These could be establishing formal educational institutes under PPP mode and expanding the existing ones and twinning arrangements/ academic and financial collaborations with Indian institutions, course content development, training (faculty and students) and other innovative service offerings for the higher education sector also importantly providing infrastructure services including construction/ development.
The Indian Higher Education is the "sunrise sector" for private and foreign sector as it presents an unparalleled opportunity in terms of market size, minimal impact of recession and future potential reform measures proposed by the Government.
"This recognition further stems from the fact that the sector offers a huge untapped market in regulated and non-regulated segments due to low gross enrollment (GER) ratio, high concentration in urban areas and growing per capita income of the middle class," said the spokesperson.
India has the third largest higher education system in the world in terms of enrolments, after China and the US.
The number of students enrolled in the universities and colleges (formal system) has been reported to be 16 mn in academic year 2010-11.
This does not include enrollment in higher education offered through Open and Distant Learning.
India is acknowledged to have the largest higher education systems in the world in terms of number of institutes.
The university and higher education system comprises 610 universities and in addition, there are 33,023 colleges.
An estimated USD 13bn is spent outside the country.
Higher education is the second largest opportunity in the Indian education sector.