Analyzing the Indian Education Market

InfoSphereA Centre for New Economics Studies Initiative

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Aliva Smruti, Archita Sridhar, Divyansh Singh Parihar, Diya Chadha and Swasti Ray

INTRODUCTION

The New Education Policy (2020) aims to make “India a globalknowledge superpower”.

In this InfoSphere Issue, we analyze the education sector from amacro level in India.

The Issue will feature the team’s analysis on:

1. Government Spending on Education & Role of Privatization inEducation Sector

2. State’s Spending on Education and Their performance viz-a-vizGirl-child education

3. Relationship between ‘Education’ and ‘Employability:’ WideningAcad-Ind gap in India’s Labour Market

4. Impact of Teacher Training on Student Accomplishment

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GlossaryGross Enrolment Ratio (GER) - Number of students enrolled in a given level of education, regardless of age, expressed as a percentage of the official

school-age population corresponding to the same level of education. It is useful to note that GER includes students of all ages. Therefore, with late/early

enrolments, repetitions, GER can exceed 100%.

Net Enrolment Ratio (NER) - number of boys and girls of the age of a particular level of education that are enrolled in that level of

education, expressed as a percentage of the total population in that age group.

Supply side issues in Education – access to education (government colleges and schools), student aid, learning outcomes, management and

monitoring.

Elementary Education – Primary School (Class 1-5)

Secondary Education – High school or middle school (Class 6-9)

Acad-Ind Gap – Mismatch between academic education and industry requirements.

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Redrafted in 1979; announced

the newNational

Education Policy (1986) (Rajiv Gandhi

Govt.)

First National Education

Policy drafted (1968)

Kothari Commission,

the Indian Education

Commission set up in (1964)

Secondary Education

Commission set up under Dr. A.

LakshmanaswamiMudaliar in

(1952)

UGC set up under Dr.

S.Radhakrishnan(1948)

Right to Education Act (RTE) (2009)

New National

Education Policy

approved by cabinet (2020)

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MHRD released Draft New Education

Policy (2019)

Education Planning in Post-Independent India

Higher Education –Flexible degrees and Multiple Exit options

Languages – Mother Tongue & Regional

Languages till class 5

Restructuring School education 5 (Foundational)+

3 (Preparatory)+3 (Middle)+4 (Secondary)

Prioritising teacher Education - National

Curriculum Framework for Teacher Education

Academic Bank for Credits – Digital storage of credits

Gender Inclusion Fund –Assisting Female and transgender children

• While India does well compared to Bangladesh and

Pakistan, India lags substantially behind all other

developing economies.

• In 2017, in countries where the Per capita GDP was 1%

higher, the predicted gross enrolment rates in

secondary education are 0.125% higher, other things

remaining constant.

• India’s higher education market is highly lucrative for

increased private investment as there is high demand

for quality education. However, major issues lie in the

secondary education segment due to supply-side constraints.

*Results are statistically significant at 95% level of confidence.

Refer to regression output in the last page

Bangladesh

Brazil Switzerland

UK

Indonesia

India

LAC

MEX

Middle Income CountriesNPL

PAK

SWE

USANOR

Sri LankaGER

RUS

020

4060

8010

012

014

0G

ross

Enr

ollm

ent R

atio

(%

)

7 8 9 10 11Log of GDP per capita in 2017 (constant 2010 US$)

GER Fitted valuesSource :World Bank (2017) InfoSphere

Cross-Country Comparison of Gross Enrollment Ratios in

Secondary education

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

5.5

6

6.5

7

1951

-52

1960

-61

1970

-71

1980

-81

1990

-91

2000

-01

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

2017

-18

2018

-19

2019

-20

Publ

ic E

xpen

ditu

re o

n Ed

ucat

ion

(% o

f GD

P)Public Expenditure on Education (as percentage of GDP)

Target Expenditure on Education - 6% Recommended by Kothari Commission (1964-68)

NEP 1968

NEP 1986(Revised)

Source: MHRD Budget Estimates

RTE 2009 New NEP

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-9

-6

-3

0

3

6

9

12

15

18

-40,000

-20,000

0

20,000

40,000

60,000

80,000

2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

( %) C

hang

e in

allo

catio

n (Y

oY)

Allo

catio

n to

Dep

t. of

Sch

ool E

duca

tion

(in R

s cr

ore)

Change (%)Source: MHRD Budget Estimates

ALLOCATION TO DEPARTMENTS OF SCHOOL EDUCATION

• 2015-16 – GOI released only 57% of Allocation to Sarva

siksha Abhiyan (SSA)

• Only 27% of States share (on average, across states) was

released.

• By September 2015, only 23% of approved plans were

spent.

• In July 2018, Samagra Siksha Abhiyan (SMSA)

subsumed three schemes: (a) SSA (class 1-8); (b) Rashtriya

Madhyamik Shiksha Abhiyan (class 9-12) and (c) Teacher

Education.

• Under SMSA only 71.27% of the RE- 2019-20 is spent till

January 2020. (Acc. to Report 312th report of standing

committee on HRD)To know more:

https://www.prsindia.org/parliamenttrack/budgets/demand-grants-2020-21-

analysis-human-resource-development

https://cprindia.org/sites/default/files/policy-briefs/SSA.pdfInfoSphere

-9

-6

-3

0

3

6

9

12

15

18

21

24

27

30

-19,000

0

19,000

38,000

57,000

2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

( %

) C

hang

e in

allo

catio

n (Y

oY)

Allo

catio

n to

Dep

t. of

Hig

her

Educ

atio

n (in

Rs

cror

e)

Change (%)

ALLOCATION TO DEPARTMENTS OF

HIGHER EDUCATION

• About 51% of the Department’s expenditure has

been allocated to central universities (as grants),

IITs, and statutory and regulatory bodies such as

UGC.

• Majority of enrolment in higher education is

handled by state universities and their affiliated

colleges.

• 65% of the UGC’s budget is utilised by central

universities and remaining 35% is utilised by the

States.

• State fund is left to be mobilised through

contributions from Industry. To know more: https://www.prsindia.org/parliamenttrack/budgets/demand-

grants-2020-21-analysis-human-resource-development

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0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

2000

-01

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

2015

-16

2016

-17

2017

-18

Cen

ter

and

Stat

e Sp

edin

g as

a %

oif

GD

PCentre and State Spending on Education (as a percentage of GDP)

Centre as % of GDP States as % of GDP Source: MHRD Budget Estimates

• Allocation to World Class Institutions in 2020-21 - increase of 23% from the revised estimates of 2019-20.

• GOI selected 10 private institutions and 8 public institutions as institutes of eminence - greater autonomy in admitting foreign students, fixing

fees, and recruiting foreign faculty.

• The funding allocation for Rashtriya Uchchtar Shiksha Abhiyan (RUSA) has significantly decreased by 78%. The scheme aims to improve

the overall quality of existing state higher educational institutions.

• Grants to central universities has also declined.

• Hence, we see gradual Privatisation and tightening Centre-State relations with falling allocations to states.

Source: MHRD Budget Estimates

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0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Grants toCentral Unis

IITs UGC andAICTE

NITs StudentFinancial Aid

Improvingsalary ofteachers

Digital India-e-learning

World ClassInstitutions

IIITs Research andInnovation

RUSA Others

Allocation of Budget to Major Heads under the Department for Higher Education (2019-20 to 2020-21)(in Rs.Crores)

2019-20 RE 2020-21 BE

Performance of States vis-a-vis Girl-

Child Education• Bihar, Rajasthan, Madhya Pradesh and

Chhattisgarh - performing poorly in terms

of educational outcomes of girl children are

also the states with lesser share of approved

resources for girls' education.

• A part of the central release of funds to

states for SMSA is performance linked. 0

20

40

60

80

100

120

AndhraPradesh

Bihar Chhattisgarh Delhi MadhyaPradesh

Maharashtra Rajasthan Telengana Uttarakhand West Bengal

Net Enrolment Ratio (NER) for Girls

Net Enrolment Ratio for girls at elementary level Net Enrolment Ratio for girls at higher secondary level

Source: MOSPI, 2015

0

5

10

15

20

25

30

35

40

AndhraPradesh

Bihar Chhattisgarh Delhi MadhyaPradesh

Maharashtra Rajasthan Telengana Uttarakhand West Bengal

Intervention for Girls' Education in Total Approved Outlay (2018-19) (%)Poor Performance of states in Girl’s

education

Lesser share of approved

resources for Intervention in Girls. education InfoSphere

Low Budgetary

Allocations

Slow paced

release of

funds from

Centre

Lower Share of

allocated funds

released to

States

States resort to

market for funds

(Privatisation)

Increase in

Price of

education

Low learning

outcome for

those being

aided by govt. Acad-Industry Gap

Consequences of Low budgetary Allocations

1.50.94

0.23

6.57

2.96

0.53

8.15

3.9

0.76

0

1

2

3

4

5

6

7

8

9

Tot

al

Act

ivel

y Lo

okin

g fo

r Jo

bs

Empl

oyab

le

Tot

al

Act

ivel

y Lo

okin

g fo

r Jo

bs

Empl

oyab

le

Tot

al

Act

ivel

y Lo

okin

g fo

r Jo

bs

Empl

oyab

le

Technical Non-Technical All Graduates

Supp

ly o

f Lab

our

(in m

illio

ns)

Level of Education

Supply of Educated Labour

Source: NSDC NASSCOM Report

• The graph represents the supply

side issues of quality and quantity

in the educated labour market.

• Gap in learning outcome and

desired employment skills.

• Only 0.15 million technically

qualified candidates are estimated

to be employable out of the 0.78

million people supplied from

technical streams in 2013.

Read more: NSDC NASSCOM Report

Learning Outcome and Employment: Acad-Ind gap

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Source: Indian Skills Report 2020

Pradhan Mantri Kaushal Vikas

Yojana (PMKVY)Skill Investment vs. Outcome

231734

67944

127295

81739

401875

120985

201486

9976182732

104001119243

33092

85629

53320

207676

70160

119466

5014339130

67473

0

50000

100000

150000

200000

250000

300000

350000

400000

450000

Rajsa

than

Karna

tka

Tamil n

adu

Andhr

a Pra

desh

Uttar P

rades

h

Wes

t Ben

gal

Harya

naDelh

i

Mahara

stra

Telan

gana

Num

ber

of C

andi

date

s

States

Passed Candidates Employed through placement

• Launched in 2015 to promote skill development and employability among youth workforce.

• The Government of India had sanctioned an amount of Rs. 28,38,71, 578 for year 2016-18 towards implementation of the State engagement components of PMKVY (2016-20).

• The graph shows the number candidates who have successfully passed the course and number people who were able to find employment.

Read more: Indian Skill Report 2020

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Training of Teaching Staff: INSET Training

Source: Impact of In-Service Teacher Training on Classroom Transaction(National Council of Educational Research and Training, 2012) InfoSphere

02468

10121416

Andhr

a Pra

desh

Bihar

Chhatt

isgarh

Gujara

t

Harya

na

Jammu &

Kash

mir

Madhy

a Pra

desh

Mahara

shtra

Megha

laya

Nagala

nd

Odis

ha

Rajas

than

Tamil N

adu

Uttar

Prad

esh

Wes

t Ben

gal

Ran

k States

Relevance of training to teachers and student achievement

Rank on Student Achievement

Rank on Relevance of Training to teachers

• INSET – In-Service training is a school-based workshop for teachers to help improve teaching methods and student-centered learning.

• In Tamil Nadu, Uttar Pradesh, Gujarat, Jammu and Kashmir and Odisha - Student achievement was found significantly correlated with the relevance of INSET and enrichment of understanding of the content .

Read more: Impact of Teacher training on class room transaction

Variable Rank Order Correlation

Relevance of teacher training 0.54

Presentation of New concepts and Ideas through Discussion and

Explanation

0.28

participation in discussion and making experience-based comments

for participation

0.25

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0

2

4

6

8

10

12

14

16

Andhr

a Prad

esh

Bihar

Chhatt

isgarh

Gujarat

Haryan

a

Jammu &

Kash

mir

Madhy

a Prad

esh

Mahara

sh tr

a

Mcgha

laya

Nagala

nd

Odisha

Rajasth

an

Tamil N

adu

Uttar P

rades

h

West

Beng

al

Ran

k

Rank on Student Achievement Rank on Presentation of New Concepts/Idea by Discussion with Explanation

Correlation between Teacher Discussion and Explanation (taught in INSET Training) and Student Achievement

Source: Impact of In-Service Teacher Training on Classroom Transaction(National Council of Educational Research and Training, 2012)

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0

5

10

15

20

25

30

Andhr

a Prad

esh

Bihar

Chhatt

isgarh

Gujarat

Haryan

a

Jammu &

Kash

mir

Madhy

a Prad

esh

Mahara

sh tr

a

Mcgha

laya

Nagala

nd

Odisha

Rajasth

an

Tamil N

adu

Uttar P

rades

h

West

Beng

al

Ran

kCorrelation between Teacher Discussion (taught in INSET Training) and Student Achievement

Rank on Participation of Teachers in Discussion-making Comments on the basis of their Experience

Rank on Student Achievement Source: Impact of In-Service Teacher Training on Classroom Transaction(National Council of Educational Research and Training, 2012)

• Allocations on education has seen an upward trend. However, the release of funds from the Central Government has been meager. Despite

this, the spending on education taken up by States by mobilizing funds from the private investment space. Given that the States share in

total spending on education (as a constitutional separation of powers too) is much higher compared to the Centre, the Central government

must ensure that for implementation of NEP 2020, the State gets more finance to address its grand vision.

• States’ performance on Girls’ education has been poor and with the Centre allocating funds based on the State’s performance, it has

trapped states such as Bihar, Rajasthan, Madhya Pradesh and Chhattisgarh in a vicious cycle where states have lesser and lesser funds (and

performance improvement becomes difficult).

• We see a gradual creeping of rampant, ad-hoc Privatization in all levels of education during the years. However, with the endorsement of

push towards private players in NEP 2020 policy, letting private investment alone dictate the dynamics of education sector performance will

only worsen issues of accessibility, equity and other supply-side constraints for quality education of the masses.

• We witness a gap in employability and the quality of labour ensured by schemes such as PMKVY. The onus of this gap falls on learning

outcomes and deepen the Acad-Ind Gap. The NEP’s focus on learning outcomes through flexible approaches for subject selection is

refreshing. However, teachers training is of utmost importance for this change to materialize. More pilot studies must be conducted to

ensure efficacy of the policy.

CONCLUSION

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VARIABLES GER

lgPCGDP 12.483***-2.484

Constant -19.648-23.177

Observations 17

R-squared 0.627

Standard errors in parentheses*** p<0.01, ** p<0.05, * p<0.1

Regression Output

For any inputs, comments or clarifications please contact The Centre for New Economics Studies at cnes@jgu.edu.in.

Thank you!

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