Making India the skill capital of the world is one of the visions of Prime Minister Narendra Modi. While this will be a journey, the Union Budget 2015 does provide an opportunity for the government to bring to the forefront policies and initiatives that will be undertaken to achieve the vision.
A Deloitte study has recognised the Indian education sector as a ‘sunrise sector’ for investments. This is because the sector offers huge potential to investors in the regulated as well as non-regulated markets. The education market in India, which is at present valued around $150 billion, is headed for a major leap forward in the years to come. As a percentage of GDP, expenditure on education has gone up from 2.9% in 2008-09 to approximately 3.4% in 2014-15. Compare this with the Kothari Commission (set up in 1964-65) and National Education Policy recommendation suggestion of allocating 6 percent of GDP towards education.
Statistics reveal that the allocation to the education sector received a 17 percent jump for fiscal year 2013-14 and approximately 12.5 percent for fiscal year 2014-15. However, it is still inadequate considering the sectoral requirement.
Thus, it is ironical to note that though the outlay of 6 percent of GDP was recommended almost 50 years ago, we are still far from reaching the mark in view of the present outlay not crossing even 4 percent of GDP.
The need of the hour is an increase in public expenditure on education along with incentivising the sector for private investment. A sound and efficient education system combined with growth and opportunities in the Indian economy will enable restricting flight of intellectual capital. There is a need to substantially add quality institutions, lest Indian students will have to look overseas for securing the desired level of education. Education tourism could be the next opportunity for India. Policies could be formulated that focus in this direction. India can well be seen as being intellectual capital of the world.
