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Budget 2021: Will govt allow FDI in school education?

BusinessToday.In     January 21, 2021

The education sector, which witnessed a sea change over the past year in the wake of the COVID-19 pandemic, received a push with the introduction of the National Education Policy (NEP). The NEP along with the entire focus shifting to online learning due to the pandemic has altered the whole paradigm for the sector.

As Finance Minister Nirmala Sitharaman presents the Union Budget 2021 on February 1, education experts expect a higher allocation for the sector in the Budget 2021 along with a long-standing demand to open up FDI in school education.

The education sector is hoping the government will allow international fund infusion in school education to help integrate the alliance between EdTech and Academia with an emphasis on strengthening innovations around experiential learning, teacher training, and amalgamation of sports and performing arts into mainstream education.

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It is imperative that the Centre looks into the challenges faced by the sector and educational institutions since March 2020 when the coronavirus-induced lockdown restrictions came into force. This shifted the entire focus to online learning, which neither educational institutes, nor teachers were ready for. The government needs to address the technological as well as financial challenges faced by schools to ensure smooth delivery of education, and strengthen them by providing support through various initiatives.

This will give the sector the required push in terms of infrastructure, institutes, and quality education.

Increasing budgetary allocation for education is one of the key demands of the sector. Looking at the data of the last three years, the budgetary provision for education has been contracting from 3.71% of GDP in 2017-18, to 3.48% of GDP in 2018-19 and further to 3.2% in 2019-20. The government, had in the last financial year allocated Rs 99,300 crore for the education sector.

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Since the education sector in India continues to be a strategic priority for the government, it has already allowed 100% FDI in the education sector through the automatic route since 2002.

The foreign fund infusion in the sector stood at $3.24 billion between April 2000 to March 2020, according to DPIIT (Department for Promotion of Industry and Internal Trade) data.

Experts have also called for the upcoming budget to build on recent reforms in labour and education, and continue to provide policy as well as financial support for skilling to ensure that the workforce in India is future ready. They expect the government to ensure sufficient fund allocation to the NEP and empower central and state level bodies.

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