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Rediff.com  » Business » Govt to create higher education financing agency

Govt to create higher education financing agency

March 02, 2016 20:21 IST

The budget stresses on the importance of teaching, besides seeking to recognize the role of private players in most sectors including education and moving towards private-public partnership.

Budget Provisions

Sharp increase in its budgetary allocation for education

  • Department of School Education and Literacy has got an allocation of Rs 43,554 crore in the financial year 2016-17 as compared to Rs 42,186 crore as per the revised estimates for 2015-16.
  • Department of Higher Education was allocated Rs 25,399 crore for the year 2015-16 while it Rs 28,840 crore for the year 2016-17.
  • Allocation for social sector including education and health care increased to Rs 151581 crore from Rs 139619 crore. 62 new Navodaya Vidyalayas will be opened. Sarva Shiksha Abhiyan to increasing focus on quality of education.
  • Regulatory architecture to be provided to ten public and ten private institutions to emerge as world-class Teaching and Research Institutions
  • Higher Education Financing Agency (HEFA) to be set-up with initial capital base of Rs 1000 crore which will leverage funds from the market and work to create infrastructure in India's top institutions like IITs, to ensure 20 such places of learning emerge as world class. HEFA will be a not-for-profit organisation that will leverage funds from the market and supplement them with donations and CSR funds.
  • Enabling regulatory architecture to be provided to 10 public and 10 private institutions to emerge as world-class teaching and research institutions.
  • Entrepreneurship Education and Training through Massive Open Online Courses.

Entrepreneurship, education and training will be provided in 2,200 colleges, 300 schools, 500 government ITIs and 50 vocational training centres through massive open online courses.

  • The National Career Service launched in July, 2015, already has 35 million jobs seekers registered on the platform. The government proposes to make 100 Model career centres operational by the end of 2016-17 and inter-link State Employment Exchanges with the National Career Service platform.

Focus on skill development

  • Allocation for skill development increased from Rs 1038 crore to Rs 1804. crore. 1500 Multi Skill Training Institutes to be set-up. National Board for Skill Development Certification to be setup in partnership with the industry and academia. Service tax on services of assessing bodies empanelled centrally by Directorate General of Training, Ministry of Skill Development & Entrepreneurship being exempted, with effect from 1st April 2016 from present 14%.

The emphasis on the national skills mission, and easier loans for higher education are all steps in the right direction and hold promise for the immediate and long term. A national skill mission to consolidate skill initiatives spread across several ministries to be launched will help various companies in education sector who have launch skill development institutes. Thrust on education by increasing allocation goes well for education sector and Education companies like Educomp, Everonn, NIIT.

Stocks to watch

Aptech, Everonn Education, NIIT and Educomp Solution

Outlook

Education remains one of the key focus of the new government. India is faced with a unique opportunity – highest increase in working age (15-64) population over the next 20-30 years which can propel economic growth. India will account for 25% of the global increase in workforce over the next 4 decades. The government is focused on improving the literacy rate and the quality of education in the country along with focus on skill development. Budget was positive for the sector.

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