India has the third largest education system globally, after China and the US. In a country, with population of over 1.2 billion, a large number of children expect for better prospects and better education. After Information Technology, Real Estate and Retails sector, the focus is converging on Education. The country has an extensive network of education system and institutions. However, there are growing demands for better and efficient education systems.
The Indian education sector has been recognized as a “Sunrise Sector” for investment in the recent past. This recognition stems from the fact that the sector offers a huge untapped market in regulated and non-regulated segments due to low literacy rate, high concentration in urban areas and growing per capita income.
The Government of India has allowed foreign direct Investment (FDI) up to 100 per cent through the automatic route in the education sector.
There are various growth drivers of Indian education sector.
• Increasing awareness: increasing awareness towards education and increase in job opportunities and salaries offered making investment in education in India prudent.
• Demographic advantage: There is a huge demand for up gradation of education sector in India, as the country is expected to have a surplus of 47 million people in the working age group by 2020.
• New job avenues : creating a new field of expertise and employment opportunity for poor youth, rural accounting, knowledge process outsourcing (KPO), legal process outsourcing (LPO), retail, aviation, animation etc. demanding highly skilled manpower
• Technology aided delivery: Increase in penetration of technology resulting in virtual learning and education delivery.
• Human resources based Economy: The service sector, which includes real estate, hotels, restaurants, banking, and insurance, wholesale and retail trade increase in the demand for an educated skilled workforce.
All of the above growth drivers made investment in this sector to be the safest. Most of the capital that goes in the establishment of the infrastructure can be easily recovered. The return on investment (ROI) is quite high and assured.