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Rediff.com  » Business » Higher education sector needs more FDI: Deloitte

Higher education sector needs more FDI: Deloitte

November 13, 2012 19:39 IST
India, which has the third-largest higher education system in the world in terms of enrolments, after China and the US, needs more FDI to meet its target of doubling the gross enrolment ratio by 2020, a global consultancy firm has said in its report.

"The private sector's role in the higher education sector has been growing at a rapid pace over the last decade and needs to further expand at an accelerated rate in order to achieve the GER target," Deloitte Touche Tohmatsu India said in a recent report titled 'Indian Higher Education Sector: Opportunities aplenty, Growth unlimited'.

The government has set an aggressive target of achieving 30 per cent GER in higher education by 2020 from the current level of 15 per cent.

According to projections, the sector is expected to register a CAGR of 12 per cent from 2008 to reach a size of $31.47 billion.

According to Deloitte, as per the recent estimates by National University of Educational Planning and Administration, in order to achieve this target, an additional investment of $190 billion, which includes capital expenditure and operating expenditure, has to be made in the next eight years.

"Therefore, given the limited support, which government can provide to this sector in terms of investment, the private sector needs to play a much larger role," the report noted.

Stating that the role of private sector in higher education has significantly increased in the last decade, the report said, "However, due to various impediments, the amount of foreign direct investment attracted by this sector since
2000 stood dismally low at just $400 million."

Therefore, it is important for foreign investment and experience to flow in this sector in order to transform the domestic higher education institutions into the world's top league, Deloitte report said.

The number of students enrolled in the universities and colleges (formal system) has been reported to be 16 million in academic year 2010-11, the report said adding: "This does not include enrolment in higher education offered through Open and Distant Learning. The university and higher education system comprises 610 universities besides 33,023 colleges as well."

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