FDI in Indian Education Sector

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6 people are having a discussion on the topic (Sahil, Vasu, Muthukumar, Sonika, Shivika, Archit)

Category: Education

Group Discussion Starts

Vasu: Hi All, the topic given to us is: FDI in Indian Education sector. This will be a turning point in the Indian Education sector. The Education sector needs a lot of investment now apart from Govt spending.

Muthukumar: India being one of the largest market for education needs more infrastructure and investment in education to cater to the high demand.

Sonika: But there are no enough teachers in the primary schools and in colleges. So now expanding more and more colleges will lead to diluting the quality by having teachers who lack basic skills.

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Sahil: One more hitch in FDI in education sector is that it will make education as a business, rather than a service. So, in a country like India where the lower and middle income people are more, can Foreign players offer them education at a low cost?

Shivika: It might not be possible for them to give a high class education, with better technology at low costs. But we should not forget that there are also people who can pay a premium for a global education.

Archit: This view will only lead to the imagery that education is only for the rich. Due to private players only, the quality of Govt schools has come down. If there are private foreign universities coming, our premier institutes like IITs and IIMs too might lose their quality.

Shivika: But your argument is baseless. How do you think private schools have deteriorated the quality of Govt schools?

Archit: Private schools were able to charge a premium from parents and pay high salaries for their teachers. But Govt has a fixed salaries and hence many good teachers opt for private schools. Imagine if there is no private schools, all the good teachers would be in Govt schools improving the quality.

Sahil: Archit the point is well taken. In a country like India, where the population is so high, Govt cannot provide education for all, and the role of private players is sacrosanct.

Archit: Education in other countries like China is run by Government the Ministry of Education for public as a service. High school education is compulsory for all citizens, which is funded entirely by the Government itself.

Sahil: But their GDP is relatively high compared to us, and hence they could fund higher percentage of GDP for education.

Muthukumar: Let us also discuss about what all FDI will do to the Indian education system. World class technologies, labs and libraries will lead to enhanced quality in curriculum and technological innovations.

Vasu:  It will create Competition within the institutions leading to quality improvements, and also better technology and infrastructure will help further in research and development area.

Archit: Foreign educational institutions will be interested in starting high demand courses this will side line the national agenda and needs. The courses that will be introduced will concentrate on making quick money which will have fancy nomenclatures and alluring scheme. These institutes will resort to various malpractices to allure and attract students.

Sonika: To add to your point, already, the country has too many engineering colleges, not giving any importance to raw science, research and development in agricultural sectors, adding FDI would only lead to eradication of such courses which is of high importance.

Shivika: Degrees awarded by foreign institutions by partnering with unapproved domestic institutions will not be accredited in India, the students would be mislead and it would create a confusion.

Sonika: I hope we have covered all the perspectives and nuances of this topic, let us conclude.


What India desperately need is good quality research oriented institutes. We need to establish institutes which can bring new culture and infrastructure for creating better talent pool. For this to happen, we need to have top institutes of the world to open their centres in India. India must act in self-interest. Indian higher education is at a verge of next generation quality improvement just like Indian industry was in early 1990s when government went ahead with liberalization of economy. Liberalisation in education should be achieved through correct approach. FDI in Education should be channelled properly to raise the quality of education. There should be a suitable regulatory framework that would ensure quality and standards in curriculum, courses, teachers, evaluation and assessment systems etc. There should be effective registration and certification system, which will prevent unapproved institutions from partnering, and good quality institutes can enter into Indian education hub, which will create a good platform for domestic and foreign institutions for the exchange of technology and talents, so that the former can compete effectively in a global environment.

Facts related to the topic

• India has the largest education system nest to China and U.S.A. respectively.

• If Indian statistics are to be compared with other countries, India’s Higher Education system is the world’s third largest with respect to student enrollment, next only to China and the USA.

• The Government spending for Education sector accounts for 3.8% of the GDP of the country and it is estimated that it requires an investment of Rs 20000 crore over the next five years to expand and increase access.

• The Education in India a U.S. $100 billion business.

• The FDI inflows between April 2000 to June 2015 for Education section is US$ 1,171.10 million

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