Indian Education industry expected to cross $50 billion mark by 2015

 

 

The Associated Chambers of Commerce and Industry of India in a last week’s report found that about 55% of the country’s middle class households have started saving for their children’s higher education. With education gradually being looked at as an investment as opposed to an inevitable expense, the higher education market size in India is expected to grow by over US$30 billion in the next five years.  The association’s report revealed that the government is planning to spend about 5% of its GDP revenues in the next five years on education. Subsequently, India’s market for primary, secondary and tertiary education could be over US$50 billion by the year 2015.

 

India’s education market segment is estimated to be about US$25 billion with its higher education market being put at just less that US$15 billion. On the other hand, the primary, secondary and higher secondary education market are valued at US$10 billion according to current estimates. From the report, about 9% of middle level households saved for education a few years back but this has been replaced by a 55% rise. 

 

The association remained hopeful that in the next five years, the total market size of Indian education might go beyond US$50 billion due to higher GDP spending expectations on the sector, an increase in disposable income for urban areas and the planned increase in enrolment to higher education of 15% from its lows at 9% currently.

 

ASSOCHAM projections pointed out that the 2009/2010 fiscal year witnessed about 15% of the country’s urban per capita monthly household income spent on education. When the gross enrolment ratio is contrasted against a global average of 23%, 54.6% for developed countries and 23% for Asian countries; India has a low of 10%. Many constraints in the education sector in the country have over the time pushed students to private institutions. About 45,000 Indian students spend a total of US$30 billion on overseas education.

 

 Access to education remains an issue in India despite the government’s massive investments in the sector. However, a new government law that makes education mandatory for all children and compels private schools to reserve one quarter of their admissions for students from impoverished backgrounds is expected to try bridging the inequalities.

 

May 26, 2010.