Market Research India - Higher Education Market in India 2009

Higher Education ‐
Higher Education India
August 2009

Executive Summary

 Higher education space is regulated by University Grants Commission (UGC)
 Market valued at USD 6.5 bn in 2008; Expected to grow at 12% p.a. to USD 10.3 bn
Market  77% of the institutes in higher education are privately owned
 Engineering is the predominant course offered by colleges in India
Engineering is the predominant course offered by colleges in India
 Fundamental shortcomings in the higher education space
 Low Gross Enrolment Ratio
 Low public spending on higher education
Current  Not‐for‐profit mandate of the government and the approach adopted by private players
Not for profit mandate of the government and the approach adopted by private players
Scenario  Lack of co‐operation between public and private sector
 Lack of large players in the market
 Introduction of National Commission For Higher Education and Research (NCHER) as the apex
regulatory body in education
regulatory body in education
Government  Foreign Educational Institutions Bill of 2007
Initiatives  Provisions for higher education under the 11th Five Year Plan
 Passing of the Right of Children to Free and Compulsory Education Bill
GGrowing middle class with the ability to afford a private education
i iddl l i h h bili ff d i d i
 India’s demographic advantages
Fundamental  India: Services dominated economy
Drivers  Poor perception towards alternative education streams
 Growing private players due to large demand‐supply gap
 Expenditure on foreign education

HIGHER EDUCATION – INDIA.PPT 2

•Education System in India
•Market Overview
•Current Scenario
•Fundamental Drivers
•Government Initiatives
•Competition
•Key Developments
•Key Developments
•Appendix


Indian education system comprises of formal and informal
network of educational institutes
Indian Education System

Formal Education System Informal Education System

Higher Coaching Vocational
Schools (K12) Pre‐ Schools
Education* Classes Training

Multimedia
Public Private Public Private in schools Books
and colleges

• Under the purview of the Ministry of Human Resource
Development
• Higher education comprises graduate/ diploma/ • Informal Education system is free of any regulations
professional courses regulated by University Grants • Not governed by any regulatory body
Commission (UGC)
• Professional colleges must operate as not‐profit institutes
set up under a Trust/ Society

Note: * Graduate and Post‐graduate courses


Major developments over the years has allowed India to have a
well structured regulatory system in place

University Education Commission constituted in 1948

UGC established by an Act of Parliament in 1956
UGC established by an Act of Parliament in 1956

Establishment of National Council of Education Research and Training in 1961

Indira Gandhi National Open University (IGNOU) established by an Act of Parliament in 1985

In 1988, the AICTE bill made AICTE the statutory body for planning and development of technical education

NCTE vested with statutory status by an Act of Parliament in order to educate teachers in 1993

Establishment of National Assessment and Accreditation Council to access and accredit HEIs in 1994

In 2004, Education Cess levied for raising additional funds. EDUSAT, a satellite dedicated to education, launched

In 2009, the government plans on introducing the Foreign Education Bill allowing FDI inflow in higher education


Indian higher education is decentralized with separate councils
responsible for the regulation of different institutions
Ministry of Human
Resource Development

Department of Higher University Grants
Education Commission (UGC)

All India Council of Indian Council for
Dental Council of India Bar Council of India
Technical Education Agricultural Research

Medical Council of
di l il f National Council for
i l il f Pharmacy Council of
h il f
India Teacher Education India

Central Council of
Central Council of
India Nursing Council Council of Architecture Rehabilitation Council
Homeopathy

Distance Education State Councils of Higher
Central Council for
Council
Council Education
Indian Medicine


University Grants Commission is the major regulatory body for
education in India and receives assistance from various councils
University Grants Commission (UGC)

• Responsible for the coordination, determination and maintenance of standards of teaching,
examination and research in universities
• Manages the disbursement of grants obtained from the central government
• Monitors developments in the field of collegiate and university education
• Constantly advises the Union and State governments on development measures that can be
undertaken to improve the higher education system

Central Government
Major
Bodies • Provides grants to UGC
• Establishes central universities
• Responsible for the declaration of education institutions as ‘Deemed to be University’ on the
recommendation of the UGC

State Government

• Establishes State Universities and colleges
• Provides plan grants for development and non‐plan grants for maintenance of these State
institutions
The Central Advisory Board of Education acts as a bridge allowing for coordination and cooperation between
The Central Advisory Board of Education acts as a bridge allowing for coordination and cooperation between
the Union and the States with respect to education


Major Councils (1/5)

All India Council of Technical Education (AICTE)

• Establishes, maintains and regulates the norms and standards in technical education
• Its purview includes training and research in engineering, technology, architecture, town
p g g g gy
planning, management, pharmacy, applied arts and crafts, hotel management and catering
technology
• Comprises of various bureau’s namely: Faculty Development, Undergraduate Education,
Postgraduate Education and Research, Quality Assurance, Planning and Co‐ordination,
Research and Institutional Development Administration Finance and Academic Bureau
Development, Administration,
Major
Council Medical Council of India (MCI)
s • Maintains uniform standards in medical education for undergraduate and postgraduate
programmes
• Responsible for recognition/de‐recognition of medical qualifications of medical institutions
in India or those beyond the purview MCI (foreign institutions)
• Registers doctors (permanent/provisional) with recognized medical qualifications

Indian Council for Agricultural Research (ICAR)

• Apex body coordinating, guiding and managing research and education in agriculture
including horticulture, fisheries and animal sciences



National Council for Teacher Education (NCTE)

• Established as a statutory body in 1995 under the National Council for Teacher Education
Act, 1993
• Plans and coordinates development of the teacher education system in India
• Its mandate includes equipping teachers to teach at pre‐primary, primary, secondary and
senior secondary stages in schools, and non‐formal education, part‐time education, adult
education and distance (correspondence) education courses

Major
Council
s Dental Council of India (DCI)

• Established as a statutory body in 1949 under an Act of Parliament ‐ the Dentists Act, 1948
• Maintains uniform standards of dental education for undergraduate and postgraduate levels
 Its roles includes the inspections/visitations of existing Dental Colleges. They must be consulted during
the establishment of new colleges, increase of seats and during the introduction of new P.G. courses
• Prescribes the standard curricula and examinations to be conducted during the training
programme



Pharmacy Council of India (PCI)

• Established as a statutory body with the passage of the Pharmacy Act in 1948
g g p g
• It regulates graduate level education programmes in Pharmacy y
• Its functions include
 Maintaining a uniform education standard
 Prescribing minimum standard of education required for qualifying as a pharmacist
 Setting conditions for the establishment of new pharmacy institutions
 Institutions require their approval regarding the study material and examination pattern
Major  Approves qualifications granted outside the territories to which the Pharmacy Act extends i.e. the
Council approval of foreign qualification
s  Maintains the Central Register of Pharmacists

Indian Nursing Council (INC)

• Established under the Indian Nursing Council Act, 1947 of parliament
• Establishes and monitors a uniform standard of nursing education for nurses midwife,
Auxiliary Nurse‐Midwives and health visitors
Nurse Midwives
• Responsible for the registration of Indian and Foreign Nurses possessing foreign
qualification
• Prescribes the syllabus & regulations for Nursing programs
• Power to withdraw the recognition of qualification from an institution maintaining low
standards
t d d



Bar Council of India (BCI)

• Established under the Advocates Act, 1961 as the Apex Body for regulating the legal
profession as well as supervise the standard of legal education in India
• Promote legal education and maintains standards in consultation with the Universities in
India and the State Bar Councils

Central Council of Homeopathy (CCH)

Major • Established by the adoption of The Homoeopathic Central Council Bill in 1973
Council • Maintains uniform standards of education in Homoeopathy
s • Registers all practitioners of Homoeopathy in order to maintain the quality of services
provided
• Regulates diploma, degree, graduate and post graduate courses
• Establishes minimum requirements for the development of such educational institutions

Central Council for Indian Medicine (CCIM)
Central Council for Indian Medicine (CCIM)
• Established in 1971 under the Indian Medicine Central Council Act
• Prescribes minimum standards of education in Indian Systems of Medicine with regard to
Ayurved, Siddha, Unani Tibb
• Advises the Central Government in matters relating to recognition (inclusion/withdrawal)
g g ( )
• Maintains a Central Register on Indian Medicine which is constantly updated



Council of Architecture

• Established under the provisions of the Architects Act in 1972
p g p p g
• Responsible for the regulation of education and practice of the profession throughout India
• The Council overseas the registration of architects, standards of education, recognized
qualifications and standards of practice to be complied with by the practicing architects
• Empowered to make recommendations to the Government of India with regard to
recognition and de‐recognition of a qualification
Major
Distance Education Council
Council
s • Develops a network of open universities/distance education institutions across India
• Establishes an innovative system of University level education by creating an open and
Establishes an innovative system of University level education by creating an open and
flexible system with regard to courses offered, eligibility for enrolment, age of entry and
examination system
• Identifies specific client groups and the types of programmes to be organized
• Decides on the basis upon with financial assistance is received by open universities/ distance
Decides on the basis upon with financial assistance is received by open universities/ distance
education institutions
• Co‐ordinates and develops instruction material and designs the fee structure
• Sets‐up a Review Committee to asses the performance of various institutions
• Oversees procedures and practices of admission evaluation completion of course
Oversees procedures and practices of admission, evaluation, completion of course
requirements and transfer of credits


•Market Overview
•Current Scenario
•Competition
•Key Developments
•Key Developments
•Appendix


The education industry in India has been growing strongly with
major contributions from K‐12 and higher education segments
Overview Total Education Market Size and Growth
• The education industry in India is valued at USD 50
bn in 2008 USD bn
+12% 80
80
• It is expected to grow at a 12% CAGR to USD 80 bn by 70
63
2012 60
50
56

• Current public spending on education in India is ~ 40
3.5% of GDP
20
 Central government accounts for 15% of the total
Central government accounts for 15% of the total
expenditure while State government accounts for 85% 0
• India’s literacy rate stands at 61% 2008 2009e 2010e 2011e 2012e

Higher Education Segmented Education Industry (USD 50 bn)
Total Expenditure (USD 20 bn) K-12
20% Higher Education
Informal Education
40%
Foreign
Foreign
Indian institutions Capitation Fee* institutions
(USD 6.5 bn) (USD 1.5bn) (USD 12 bn)
40%
*Note: Capitation fee are cash transaction between students and
institutes giving the student direct admission without
any evaluation procedure


The higher education market is expected to develop further due
to large scale private and public participation
Overview Higher Education Market Size and Growth
• The expenditure on higher education in India is
estimated to be USD 6.5 bn in 2008 USD bn
12 +12%
• Expected to grow at 12% CAGR to reach USD 10.3 bn 10.3
10 9.2
by 2012 8.2
8 7.3
6.5
• Private institutions have been focusing on the area of 6
professional courses like engineering and medical as 4
well as post graduation courses like MBA
well as post graduation courses like MBA 2
 Private set‐ups account for ~50% of the total medical seats 0
and ~80% of the engineering seats available to students 2008 2009e 2010e 2011e 2012e

Growth in Higher Education Institutions Market Segmentation
‘000 Private Institutes Engineering
23%
25 Public Institutes MBA
+9% 20.67
20 18.81 Medical
17.20
15.75 Others
15 14.50
14 50 77%
13.30
11.14 12.15
10

5 1.5%
75.0% 16.7%
0 7.8%
2000-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08


The institutes located in southern and western India account for
the largest intake..
Master of Bachelor Master of
Bachelor of Master of Bachelor of Master of
Region States Engineering/ of Business
Engineering Pharmacy Architecture Architecture
Technology Pharmacy Administration

Andhra Pradesh
Andhra Pradesh 170897 19320 15160 625 310 80 10158

Karnataka 58977 12627 10176 2117 360 NA 21270

Kerala 83470 4599 NA NA 180 NA 3960
SOUTH
Orissa 20810 3526 1005 416 116 NA 3724

Pondicherry 3201 304 NA NA NA NA 240

Tamil Nadu 132562 28605 2490 906 300 NA 20370

Gujarat
G j 16276 1642 NA NA 220 60 540

WEST Maharashtra 76070 9178 7705 1062 NA NA 12225

Rajasthan 25021 2509 2880 390 120 NA 6620

Chhattisgarh 11520 538 NA NA 40 NA 300

CENTRAL Jharkhand 3100 242 60 30 NA NA 180

Madhya Pradesh 52100 4191 NA NA 140 NA 4080
NOTE: Data refers to the intake of students for 2008‐09
All States in India have not been covered


.. of students in the higher education sector

Regions States Engineering/ of Business

Delhi 5708 1499 216 58 138 345 1280

Haryana 34630 3340 2040 106 74 NA 6085

Himachal Pradesh 2010 282 670 NA NA NA 630

NORTH Jammu & Kashmir
J &K h i 2995 438 30 NA NA NA 600

Punjab 22286 3192 NA NA NA NA 1740

Uttar Pradesh 68367 2140 NA NA 210 210 4480

Uttarakhand 3660 312 NA NA NA NA 300

Arunachal Pradesh 180 78 NA NA NA NA NA

Assam 1190 351 100 20 NA NA 180
EAST
Bihar 2075 324 45 NA 22 NA 730

West Bengal 19408 3289 730 84 54 NA 2425



•Market Overview
•Current Scenario
•Competition
•Key Developments
•Key Developments
•Appendix


Summary

Fundamental shortcomings in the higher education space

Low Gross Enrolment Ratio

Low public spending on higher education
Current
Scenario
`

Lack of co‐operation between the government and the private sector

Mandate of the government and the approach adopted by private players

Lack of large players in the market


Fundamentally, this segment is encompassed by bureaucracy
and inefficiency which is deterring growth
Fundamental shortcomings in the higher education space
• The regulatory bodies for higher education in India are perceived to be extremely corrupt and with bureaucratic
complexities ingrained in them
• The situation is a case of over‐regulation but under‐governance
• This makes the entry of new players and the expansion of operations for existing players difficult

• Involvement of politicians with respect to ownership and the large scale lucrative cash transactions due to the shortage
of quality institutes has led to sub‐standard education being imparted to students
of quality institutes has led to sub standard education being imparted to students
 75% of the educational institutes in Maharashtra are operated by politicians
• The curriculum for various professional courses is outdated and is incomparable to global standards

• Examination system looks at testing a students capabilities at memorizing information rather than application of the
Examination system looks at testing a students capabilities at memorizing information rather than application of the
discipline learnt
• Focus has always been on mechanical learning with minimal inclination towards developing a link with industrial
applications of the subject
• Most institutions lack a good faculty which is primarily due to the lack of incentives and the meager salary earned by
teachers in comparison to their counterparts around the world

• This is an oversubscribed sector, consisting of many small institutions, with most colleges providing low quality
education which is thus unable to lead to employment generation
 80% of the graduates in general streams (B.Sc./ B.A.) are unemployable which has made students weary of enrolling into
professional courses


India’s low gross enrolment ratio provides opportunity for new
and existing players in the market
Low Gross Enrolment Ratio (GER)
• India has the third largest volume of enrollments in higher education, after China and the US
• However, India’s GER compares poorly to its global counterparts
• Furthermore, high dropout rates in primary education has affected the enrolments in higher education
 Grade 1‐5 : 29%; Grade 6‐8: 50%; Grade 9‐12: 62%
• The planning commission is targeting a GER of 15.5% by 2012 which is an increase from 11% in 2008
 National Knowledge Commission has recommended that the Government will need to establish ~1500 universities to
meet their GER target
t th i GER t t
 The expenditure required in higher education will have to increase to 1.5% of the GDP from the existing level of 0.7%
• This translates into a huge potential for about 22 mn students enrolling in higher education institutions by
2012
Enrolment GER (2008)
GER (2008)
mn %
60%
25 +16% 22.0 60
20 18.6 40%
16.1
15 13.9 40
12.0
10 21%
20 11%
5
0 0
2007‐08
2007 08 08‐09
08 09 09‐10
09 10 10‐11
10 11 11‐12
11 12 India BRIC Developed US & Canada
Developed US & Canada
European
Countries


Public expenditure focussing on primary education has led to an
underdeveloped higher education sector
Low public spending on higher education
• Public spend on education in India amounts to ~5.2% of the world’s cumulative public spend, but India is
home to 20% of the population in the target group
• The investment in the higher education sector increased from 0.67% of the total GDP in FY07 to 0.7% of the
total GDP in FY08
• The share of higher education expenditure as a percentage of total education expenditure has declined to
19.1% in FY08 from 19.4% in FY06
• L k f hi h
Lack of higher education infrastructure has made it extremely difficult for India to act as a hub for
d ti i f t t h d it t l diffi lt f I di t t h bf
professional education
 The current higher education infrastructure can admit only 7‐8% of the college‐age students
 India attracts ~ 20,000 foreign students yearly, whereas China attracts more than 0.15 mn students annually
• Even though public expenditure on education has been rising the investment per student is one of the
Even though public expenditure on education has been rising, the investment per student is one of the
lowest among other major countries
Annual public expenditure on higher education per student
USD
15,000
15 000
11,790
9,629
10,000 8,502
4,830 3,986
5,000 2,728
1,024 406
0
Malaysia USA UK Japan Brazil China Russia India


Lack of co‐operation between government and private sector
entities has hampered public private partnerships

The ‘not‐for profit’ policy of the government has drastically affected scalability in this sector
Issue
leading to lack of public private partnerships

• Real Estate/Infrastructure partnerships – Building new institutions can be used by private
players in order to generate third party revenue
• Technical Partnerships – Link between industries and educational institutions in order to
impart skills in accordance with the needs of the industries addressing the large
i t kill i d ith th d f th i d t i dd i th l
employability gap
 Media Institute with studio facilities
Opportunities
 Fashion Institute in partnership with a leading retail brand
 Engineering college in a tie up with an IT Product company
Engineering college in a tie up with an IT Product company
• Commercial Partnerships – Creating a self sustaining revenue generation stream which
would fund various capacity building initiatives within educational institutions
• Foreign University Partnerships – Collaboration with foreign institutes and universities
towards ensuring high quality education meeting global standards

• The unavailability of large scale commercial return has led to an untapped market which
Impact
has strong potential


Private players are working around the governments policies
towards generating profits and disbursing dividends
Mandate of the government and the approach adopted by private players
• The ‘not for‐profit’ mandate of the government towards the establishment of institutions requires
educational institutions to operate as a Society or a Public Trust wherein the profits accrued must be
invested back into the institution with no scope of a profit sharing model
i t d b k i t th i tit ti ith f fit h i d l
• This has acted as a deterrent for major corporates from investing in this segment
 Multi‐layered regulatory approach in this industry has led to 80% of opportunities in the formal education space to be
elusive to commercial activity
• Players in the industry are addressing this challenge by using a two‐level structural approach in order to
Players in the industry are addressing this challenge by using a two level structural approach in order to
extract profits accumulated by the Trust through an indirect channel

Revenue Channel 1: The payment of lease rentals to S1 which provides land, services and infrastructure to the trust

1
Subsidiary 1 (S1)
Tuition Fee Trust: non‐profit
body generating a Parent Company
surplus
Teachers Salary
Subsidiary (S2)
S b idi (S2)
Trust need not be directly related
to the subsidiaries 2
Revenue Channel 2: The payment of management fees to S2 which operates the trust providing IP/ content and
management services such as content, delivery, canteen, transportation, text books etc.

• This allows players to distribute dividends or use it to fund other ventures towards scaling up operations


In comparison with international markets, India lacks large
players due to domestic policies
Lack of large players in the market
• In comparison to the US which boasts of some of the largest private players in the globe such as Apollos or
Devrys India lags considerably with the largest private player being namely Manipal University

Comparison of revenue figures

USD mn
3,000
3 000 2,700
2 700
2,000
993
1,000
180
0
Apollo Devyrs Manipal University
Manipal University

• The governments mandate which requires these establishments to operate as not‐for‐profit trusts coupled
with over‐regulation by various bodies has not created any incentive for players to enter or expand
operations towards generating high revenues
• The infrastructure required to develop a higher education institute is very capital extensive which deters
players from entering and expanding operations
 A medical college requires an investment of ~ USD 5 bn
• Long gestation period is a major problem. It has been estimated that it takes approximately 6 years to build
brand equity in this space


•Market Overview
•Current Scenario
•Competition
•Key Developments
•Key Developments
•Appendix


Summary

Growing middle class with the ability to afford a private education

Demographic advantages

India: Services dominated economy
Drivers `

Poor perception of alternative education streams

Growing private players due to large demand‐supply gap

High expenditure on foreign education


The rising income levels among the middle class coupled with
their willingness to spend on education will drive the market
Growing middle class with the ability to afford a private education Impact
• Education is the second largest expenditure Distribution of expenditure among the middle class
group for the middle class
• Economic growth is expected to drive 0 5 10 15 20 25
household income among the middle class %
Food & Grocery 24.5
• These two factors namely the willingness to Education 8.9
spend on education and the rise in purchasing
Entertainment 8.3
power will allow the growing middle class to
power will allow the growing middle class to
Mobile Phones 7.7
bid for an education from private institutes
Fuel & Transportation 4.3
Stationery 4.3
Aggregate Annual Disposable Income (INR tn) Personal Care 4.2
Communication 3.7
Globals >1000 90 Healthcare 3.2
Strivers 500‐1000
24% Footware 3.1
Seekers 200‐500
90 200
90‐200
Toys & Gifts 3.0
Aspirers 23%
Deprived <90 44 Apparels 2.8
15% Loan Repayment
9% 2.3
24 9% 34%
34% Cable & Internet
7% 2.2
49% 13% 33% 15% Household Help 2.2
23% 9% 3%
Others 15.4
2005 2015 2025


The population breakdown in India suggests that it is one of the
most promising global destinations for higher education
Demographic advantages Impact
• A large section of the Indian population is at
the age at which an individual would enroll into Population aged 15‐24
a higher education course
a higher education course
0 100,000 200,000 300,000
• This number is expected to increase further in
the future driving demand for more institutes ‘000
543
• In comparison with other major destinations for Singapore
689
higher education, India has the strongest
higher education India has the strongest
opportunity for growth due to its population
2,815
distribution Australia 2005
2,917
2010
7,841
Distribution of population opting for higher education UK
8,147
mn
42,935
500 449 USA
423 44,880
388 20 24
20‐24
400 353 121
120
112 25‐29 101,544
300 104
111 118 30‐34 Europe
200 94 103 92,976
101 110 35‐39
82 92
100 218,813
73 81 91 100 India
I di
0 233,977
2005 2010 2015 2020


Dominance of services sector and the perception among
individuals towards other forms of learning
India: Services dominated economy Impact
• The Indian economy has been growing substantially with an average GDP of 8% over the last 3
years
• The growing services sector has led to a large demand for skilled manpower which is expected
to induce growth in the higher education sector
1996‐97 2007‐08
Services
100 100
Industry
44% Agriculture 53%
28% 29%
28% 18%
Poor perception of alternative education streams
• Individuals prefer to invest in traditional forms of learning, namely professional courses, in order
to attain employment rather than enrolling into vocational training courses
• Individuals are not keen on vocational training courses as a diploma course in India is not
comparable to a degree course at the time of employment
Share of labour force receiving vocational training
%
96 85 86 88
100
50 25
8
0
India Korea Japan Germany Canada Mexico


The potential in the market is being tapped by private players
capitalizing on the demand supply gap
Growing private players due to large demand‐supply gap Impact
• The demand supply gap in the market has led to large scale private participation in the higher
education sector in order to tap into the opportunities presented by the ever increasing
demand
d d
• Over the period 2002‐07, the share of enrollments in private higher education institutions has
risen from ~ 33% to over 50%
• Private institutes account for over half the medical and engineering colleges in India and this
share is expected to grow
share is expected to grow
• The aversion among students towards institution established by the government will further
the growth achieved by the private players
• Large scale private expansion is expected in the higher education space by 2012
 800 more private engineering colleges
800 more private engineering colleges
 60 medical colleges
 300 MBA colleges


Every year a large fraction of Indian students spend huge sums
on a foreign education due to a better system of education
High expenditure on foreign education Impact
• Approximately 450,000 Indian students spend ~ USD 13 bn every year on higher education in
the overseas market
• Major foreign destinations include
Major foreign destinations include
 US: Accounts for 56% of the total students going outside the country to study
 France: Accounts for 8.8% of the total
 Other major destinations are Australia, Canada, Singapore, China, Korea , Italy, Japan, New Zealand and
South Africa
• Thi
This creates a strong opportunity for existing players and new entrants to develop quality
t t t it f i ti l d t t t d l lit
educational institutions so as to capture a substantial share of investment made on education
abroad
Distribution of fields opted for by international students in the US (2007‐08)

Others
100%
13% Education, humanities and agriculture
8% English Language
5%
5% Health professions
6%
8% Fine and applied arts
Fine and applied arts
9% Mathematics and computer science
9%
Social sciences
17% Physical and life sciences
Engineering
20%
Business and management
B i d


•Market Overview
•Current Scenario
Go e e a es
•Competition
•Key Developments
•Key Developments
•Appendix


Introduction of the National
The Right of Children to Free and
Compulsory Education Bill Commission For Higher Education
and Research

Government
Initiatives

Provisions for higher education Foreign Educational Institutions
under the 11th Five Year Plan Bill of 2007


Establishment of an independent apex body in India will lead to a
major transformation in the higher education space
Introduction of an independent National Commission For Higher Education and Research (NCHER) as
the apex body in education

• Oversee the functioning of universities and act as a facilitator for growth in higher
Oversee the functioning of universities and act as a facilitator for growth in higher
education and research
Role
• Responsibilities will entail regulation of quality standards in all branches of higher
education

• Universities are expected to become completely autonomous, guarded from interference
by external agencies allowing then to establish good governance, transparency and quality
in education
• Universities will
 Act as self‐regulatory bodies
 Design and the function and structure of programmes
Impact
 Institutions will be empowered to offer various courses including medical and engineering
programmes
• Ending the current regime of multiple regulators thus streamlining the entire education
system
• Abolishment of other regulatory bodies namely University Grants Commission (UGC), All
India Council of Technical Education (AICTE) and Medical Council of India (MCI)
India Council of Technical Education (AICTE) and Medical Council of India (MCI)


The bill will allow for a high standard of professional education
due to the operational flexibility given to foreign institutions
Foreign Educational Institutions (Regulation of Entry and Operation, Maintenance of Quality and
Prevention of Commercialization) Bill of 2007

This bill was proposed in order to allow foreign educational institutions to enter the Indian
This bill was proposed in order to allow foreign educational institutions to enter the Indian
Purpose market independently

• Allows for profit‐making, towards making this segment attractive for foreign investors.
Major Aspect
Major Aspect
However, the law does not allow the capital to be taken out of India.

• Foreign institution will be in a position to pursue their own methodology and evaluation
system
system
• They will have complete freedom to choose the faculty as well as to decide the salary
packages, allowing them to rope in experienced teachers from across the globe
• High quality foreign education is expected to lead to the retention of investments in the
Impact country which is otherwise spent on educational institutions abroad
country which is otherwise spent on educational institutions abroad
• Stronger focus on practical industry oriented learning against the theoretical form of
education in existence
• Major repercussions in the Indian education system, domestic (private and government)
q p y g , y
institutions will be required to provide better education by revising curricula, syllabi and
changing the teaching methodology to meet international standards


Provisions for higher education under the 11th Five Year Plan

• Increased the budget for the expansion of higher education facilities to INR 850 bn from
INR 96 bn allocated during the 10th Five Year Plan
Budgetary
• Setting up 30 central universities ‐ including one in each of the 16 States so far uncovered
Expansion
• Expanding and upgrading 200 State Technical Institutions, 8 IITs, 7 IIMs, 10 NITs and 20 IIITs to
accommodate a larger fraction of students in the higher education space
d t l f ti f t d t i th hi h d ti

• Create a common platform for admission through a Common Entrance Test and/or other
relevant criteria for professional courses under central universities
Admission, • Adoption of the semester system across institutions
curriculum, and
curriculum, and • Ch i th
Changing the method of assessment from annual examination to internal evaluation
th d f tf l i ti t i t l l ti
assessment
• Introduction of the Credit System making the system flexible for students
• Dynamic curriculum expected to change every 3 years with industry developments

• Introduction of a mandatory accreditation system for all educational institutions
y y
Accreditation
• Creation of multiple rating agencies with a body to rate these rating agencies
and ratings
• Department‐wise ratings in addition to institutional rating

• Restructuring teacher training programmes towards creating good quality teachers
Teachers
T h • C t tl
Constantly upgrading the capabilities of teachers through short and long term courses
di th biliti f t h th h h t dl t
Training • Expansion of research programmes/projects and creating incentive for growth in research
faculty through publicly funded projects/research
• Provide quality education in rural areas focusing on skill development by encompassing
Macro
Macro 10 mn students every year and making them industry ready
10 mn students every year and making them ‘industry ready’
Considerations
• Plans on reducing the drop out rates to 20% and increase literacy rates to 85%


The passage of the bill is expected to directly lead to larger
demand for professional courses
The Right of Children to Free and Compulsory Education Bill

The passage of this bill in 2009 has made education a fundamental right for children in the
Purpose age group of 6‐14
age group of 6‐14

• Provide elementary education to the economically and socially underprivileged class of
y y y p g
Major Aspects
M j A t
society

• Elementary education forms the basis upon which a child is in a position to generate
employment in the long run
• Larger enrollments in higher education is expected as a result of a growing fraction of
Impact students who will receive elementary education
• This is e pected to lead to a fall in drop o t rates
This is expected to lead to a fall in drop out rates
• Restructuring of basic education will make students equipped for higher education system


•Market Overview
•Current Scenario
•Competition
•Key Developments
•Key Developments
•Appendix


Many other private players are also scaling up their operations in
order to capitalize on the strong opportunities in the…
Current
Institute Established Streams Offered Business Outlook
Network
• Plans on investing between INR 3‐4 bn on
developing campuses in Dubai, US and
Amity University Singapore
Engineering, Management,
2003 38 colleges • Plans on developing a campus in Ethiopia
Law, Biotechnology
with the support of Ethiopian Government
• Tie‐ups with international educational
institutions to build brand value
Apeejay Education Management, Engineering, • Strong associations with industry leaders
Society Information Technology, • Major emphasis on enhancing soft skills
1967 15 colleges
Architecture, Fine Arts, • Encourages student exchange programmes
Communication giving students a global perspective

Gyan Vihar Universe
Engineering, Management
• Creating job oriented courses with constantly
(ISBM), Hotel Management,
1994 6,000 students developing course material through
Pharmacy, College of Post
interactive studies and extensive research
Graduation

Indian Institute of
Planning and
Management (IIPM) 9 colleges, 5,100 Management and Corporate • Plans further expansion in their international
1973
students Trainings operations

Note: This list is not exhaustive


… higher education segment which is being driven by the
demand for professional courses by students in India
Current
Institute Established Streams offered Business Outlook
network
Institute of Chartered
• Plans on expanding operations to 9 States at
Financial Analysts of
an investment of INR 10 bn by 2010
an investment of INR 10 bn by 2010
India (ICFAI) Engineering, Law,
1984 7 campuses • Foraying into the distance learning segment
Management
by offering courses such as MBA , CFA, MCA,
PG, Master in Retail and Pharma

Manipal University Medicine, engineering,
g g • Plans include building its own campus in
Plans include building its own campus in
information sciences, allied Dubai by 2010
20 colleges, 195
health sciences,
1993 courses across • Strong focus on research and is the largest
management, mass
14 streams private recipient of funds for research from
communication, hotel
management, fashion design the government

Rai University • Strong industry partnerships towards
25 campuses
developing hands‐on‐learning for students
(across India, 13 under‐grad and post‐grad
2005 • Allowing students to access training modules
UK, USA and courses
through their Rai Open Courseware initiative
Dubai)
free of cost
Sikkim Manipal
University Diploma, Bachelors • Focusing largely on distance education
550 learning programmes
and Masters courses in
1995 centres, 100,000
InfoTech, Management, Allied • India’s first university to be built on PPP
students
Health Model

Note: This list is not exhaustive


•Market Overview
•Current Scenario
•Competition
•Key Developments
•Key Developments
•Appendix


Key Developments

Date Development
The Tamil Nadu Government plans on constituting a committee to draft a charter for upgrading Government and aided
Jul ‐ 2009
colleges to Universities and enacting a legislation on setting up a Common University.
The HRD Ministry has forwarded certain guidelines allowing for transparency and accountability in deemed universities.
The HRD Ministry has forwarded certain guidelines allowing for transparency and accountability in deemed universities
They have proposed that all institutes granted 'deemed to be university status' by the University Grants Commission
Jul – 2009
(UGC) must come up with a website with 'full and complete disclosure of information‘. This move will act as a check
against educational institutions imparting low quality education with inadequate infrastructural capabilities.
The Orissa government plans on formulating a new education policy by 2010 to streamline the higher education system.
Policies are expected to include recommendations for curriculum, research, publication, inter‐university synergy,
p , ,p , y y gy,
Jul –
Jul 2009
rationalization of courses, fee structure, self financing courses, skill development, resource generation, faculty
improvement, programmes with public private partnership.
AICTE approved 85 new self‐financing engineering institutes in Tamil Nadu. This takes the tally of total private engineering
Jul – 2008
colleges in the State to 420.
Jul
Jul – 2008 The incorporation of the the Gujarat Private Universities Bill, 2009 has allowed private universities to enter the State.
The incorporation of the the Gujarat Private Universities Bill, 2009 has allowed private universities to enter the State.
Manipal Education, with the introduction of EduNxt, plans on imparting skill development training. EduNxt is a new
Jun – 2008 technology infused learning system, which enables a collaborative and interactive environment for learning and includes
small group mentoring, virtual classroom, stimulation and other interactive content.
New Zealand has become one of the preferred destinations for Indian students pursuing higher education. Over the last
Jun – 2008 six years the number of students going from India to New Zealand has seen a three‐fold increase.
six years the number of students going from India to New Zealand has seen a three fold increase

Haryana state government enacted the Private University Act to encourage private sector investment in higher education.
Oct – 2008


•Market Overview
•Current Scenario
•Competition
•Key Developments
•Key Developments
•Appendix


Appendix I – Key Aspects of the bills initiated by the government

Foreign Educational Institutions Bill of 2007
• All foreign universities are expected to become Deemed Universities, regulated by UGC
• Regulate the entry, operation and maintenance of foreign education providers in order to protect the
students from sub‐standard quality of education
• Foreign education providers a re expected to take an undertaking to maintain a corpus fund of not less than
INR 100 mn and certificate of validation from Embassy or High Commission of India

The Right of Children to Free and Compulsory Education Bill
Th Ri ht f Child t F dC l Ed ti Bill
• Private schools are required to allocate 25% of seats to the weaker sections of society
• Children of the specified age are entitled to be enrolled in the vicinity in their domicile
y y g p p p y
• For the first five years of the elementary stage, as far as possible, teachers are expected to employ the
child's mother tongue as the mode of instruction
• Development of an independent accreditation body for elementary education and major reforms in
examinations conducted
• Establishment of a fixed student‐teacher ratio
• It is applicable to all of India except Jammu and Kashmir
• School teachers are required to obtain an adequate professional degree within 5 years or else will be
dismissed
• School infrastructure must improve (if required) within 3 years else recognition will be cancelled
• No child shall be held back, expelled, or required to pass a board examination until completion of
elementary education


Appendix II – State‐ wise segregated information of the students
enrolled into various courses in higher education

Bachelor of Engineering

Master of Engineering/Technology

Index
` Bachelor & Master of Pharmacy

Bachelor and Master of Architecture

Master of Business Administration


The institutes located in southern and western India account for
the largest intake..
Region States Engineering/ of Business

Andhra Pradesh
Andhra Pradesh 170897 19320 15160 625 310 80 10158

Karnataka 58977 12627 10176 2117 360 NA 21270

Kerala 83470 4599 NA NA 180 NA 3960
SOUTH
Orissa 20810 3526 1005 416 116 NA 3724

Pondicherry 3201 304 NA NA NA NA 240

Tamil Nadu 132562 28605 2490 906 300 NA 20370

Gujarat
G j 16276 1642 NA NA 220 60 540

WEST Maharashtra 76070 9178 7705 1062 NA NA 12225

Rajasthan 25021 2509 2880 390 120 NA 6620

Chhattisgarh 11520 538 NA NA 40 NA 300

CENTRAL Jharkhand 3100 242 60 30 NA NA 180

Madhya Pradesh 52100 4191 NA NA 140 NA 4080


.. of students in the higher education sector

Regions States Engineering/ of Business

Delhi 5708 1499 216 58 138 345 1280

Haryana 34630 3340 2040 106 74 NA 6085

Himachal Pradesh 2010 282 670 NA NA NA 630

NORTH Jammu & Kashmir
J &K h i 2995 438 30 NA NA NA 600

Punjab 22286 3192 NA NA NA NA 1740

Uttar Pradesh 68367 2140 NA NA 210 210 4480

Uttarakhand 3660 312 NA NA NA NA 300

Arunachal Pradesh 180 78 NA NA NA NA NA

Assam 1190 351 100 20 NA NA 180
EAST
Bihar 2075 324 45 NA 22 NA 730

West Bengal 19408 3289 730 84 54 NA 2425



Bachelor of Engineering


Course: Computer Science

Developed Market Nascent Market
0 10,000 20,000 30,000 40,000 50,000 0 1,000 2,000 3,000 4,000

Andhra Pradesh 45,344 West Bengal
West Bengal 3,990
3 990

Tamil Nadu 30,025
Gujarat 2,715

Kerala 18,370
Chhattisgarh 2,470
Uttar Pradesh
Uttar Pradesh 15,970
5,9 0
Delhi 1,250
Maharashtra 14,985
Pondicherry 720
Madhya Pradesh 13,110
Jammu & Kashmir 690
Karnataka 13,010
13 010
Jharkhand 660
Haryana 8,670

Bihar 580
Rajasthan 6,223

Himachal Pradesh
Himachal Pradesh 420
Punjab 5,760

Orissa 4,840 Assam 170

Others 13,695 Arunachal Pradesh 30



Course: Electronics & Communication

0 10,000 20,000 30,000 40,000 50,000 0 500 1,000 1,500 2,000 2,500 3,000

Andhra Pradesh 45,374 Gujarat 2,820

Tamil Nadu 31,678 Orissa 2,473

Kerala 19,785 Chhattisgarh 1,140

Uttar Pradesh
Uttar Pradesh 14,590
,590 Delhi 1,100
1 100

Karnataka 12,710 Uttarakhand 930

Madhya Pradesh 9,210 Pondicherry 780

Haryana 7,890
7 890 Jharkhand
h kh d 660

Haryana 7,700 Maharashtra 420

Rajasthan 6,400 Jammu & Kashmir 390

Punjab 5,801 Himachal Pradesh 360

West Bengal 3,568 Assam 120

Others 11,223 Arunachal Pradesh 30



Course: Electrical & Electronics

0 10,000 20,000 30,000 0 300 600 900

Andhra Pradesh
Andhra Pradesh 27,869 Rajasthan
j 840

Chhattisgarh 840
Tamil Nadu 21,461
Pondicherry 570

Kerala 8,375
Uttarakhand 570

Uttar Pradesh 7,530 West Bengal 450

Punjab 450
Karnataka 5,565
Delhi 420

Madhya Pradesh 4,410
Bihar 360

Haryana 1,500 Jharkhand 240

Gujarat
G j t 180
Orissa 1,490
Himachal Pradesh 180

Others 5,160 Assam 60



Market Research India - Higher Education Market in India 2009

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