Higher Education
The New Paradigm in Higher Education Demand for higher education has been growing rapidly since last one and a half decades in India. Government’s initiatives towards universalisation of school education, economic liberalization, increasing Purchasing Power Parity and growing aspirations of parents and youth have led to huge demand for higher education. By Shobha Mishra Ghosh, Director, FICCI
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India is increasingly becoming an attractive market for the higher education sector as over 50% of the population falls in the age group of 15-64 years, with a median age between 20-30 years. India’s education and training sector is estimated to be about US$ 40 bn market, with a potential 16% five-year CAGR. The market size for higher education is projected to treble in next 10 years to $115 bn. The above trend coupled with low public spend has led to emergence of new models of private sector participation like the government aided private institutions, self financing institutions, deemed universities as well as the stand alone state legislated private universities. Today, about 63% of the total higher education institutions are private unaided institutions. However, there were no regulatory reforms initiated to address the changing higher education landscape. Also in this rapid expansion process there has been some dilemma about the governance system in many institutions, both in the public as well as private sector leading to dip in the quality of higher education. As per an estimate in FICCI-Ernst &Young report 2010, the higher education spend is going to increase to INR 155,015 Cr and requires an investment of INR 360,640 crores ($ 76 bn) by 2020 to create the additional capacity. The amount accounts for around 1.9 % of the current GDP based on Purchasing Power Parity. Realizing the need to increase the public spend on higher education from a mere 0.7% of GDP in the Eleventh Plan, the government is proposing to raise it to 1 percent of the GDP during the Twelfth Plan. That would still leave a deficit which needs increased private sector investment. Expecting private sector to invest money in education for philanthropic reasons is certainly not scal-
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able in the current environment. The past experience has proved that the so called ‘not for profit models’ of Trusts and Societies are opaque and have led to unfair practices. Quality of graduates is the other concern that the government is conscious of and is focusing in the Twelfth Plan. The rapid and sustained growth of Indian Industry over past few years combined with challenges emerging due to globalization has resulted in demand for high order soft and technical skills in graduates (engineering and other streams) which our higher education system is unable to deliver. According to several reports, only 25-30% graduates across the higher education spectrum are employable. Lack of appropriate Industry-academia linkages and engagements have been identified as one of the critical reasons for the lack of quality of graduates in the country. FICCI is working towards setting up of National Knowledge Functional Hubs in partnership with Industry Champions and Patron Institutions in various locations all over India with the objective to facilitate a sustainable mechanism for industry institute interaction. Both government and industry are aware that education, vocational training and skill development are the thrust areas for sustaining and continuing economic growth of the country. Higher education in particular, is critical to India’s aspirations to be a major player in the world’s knowledge economy. This has been the rationale to declare education as the priority sector for 11th & 12th Five Year Plans. The FICCI Higher Education Summit 2011: “Strategies for Expansion in Higher Education in India” organized in partnership with The Planning Commission and Ministry of Human Resource Development, Government of India on November 11 & 12, 2001 in New Delhi will deliberate on these and other relevant issues in higher education.