Dr Manasvi M Kamat
The Union Budget of India represents aspirations of the 130 billion people of our country and the one for the ensuing year will be presented on February 1. Though it is primarily true that discussions on budget math don’t allure the common men, government spending on health and education is what they look for.
Since government investments on health and education also have implications on creating the space and setting the pace for economic development, it is desired that developing economies increase their spending on education and push for digitalisation and fast reforms in the sector.
In the Union Budget 2019, the Finance Minister had allocated Rs 94,800 crore towards education and higher education programmes. This was an increase of Rs 9.8 crore compared to that of the previous year. Out of the total amount, Rs 56,536.63 crore was allotted to school education and the remainder Rs 38,317.01 crore to higher education.
For a growing economy having an army of unemployed and unskilled youth, the above provision for higher education is not only very meagre, the palpable report that government actually slashed Rs 3,000 from the budget for school education in view of fund crunch is further disheartening.
The worry of the government will be to look for the resource-means to touch vast educational aspirations of 600 million youth in the country.
The quality levels of our present educational outcomes being historically poor are yet another concern. India ranks third in terms of education score of BRICS (Brazil, Russia, India, China, and South Africa) nations.
Amongst the South Asian countries, India has the second-lowest score in education quality, ahead only of Afghanistan. In order to cover-up the lag from the last laps, increased allocations of at least 20 percent of the previous figures are needed each year for education.
Look at the glaring financial needs for education this year. The PMKVY 2.0 (PM’s Kaushal Vikas Yajana) targets to train 10 million people by 2020 but has placed merely 1.2 million candidates so far.
Higher funding for education are entailed in light of the government’s announcement to launch the ‘Fit-India Program’ and the decision to implement the ‘NEP’ (New Education Policy) from the coming year along with funding the ‘RUSA’ (Rashtriya Ucchatir Shiksha Abhiyaan), ‘Study India’ and the ‘EBSB’ (Ek Bharat Shrestha Bharat) programs.
There is an urgent need for introducing comprehensive teacher-training programs.
The country has roughly 8.5 million teachers and only 19,000 teacher training institutes. The teacher training initiative by CBSE was allocated only Rs. 125 crore, as against Rs. 871 crore allocated in the last budget, and given that MHRD initiative ‘NISHTHA’ (National Initiative on School Teachers Head Holistic Advancement) has to train over 4.2 million teachers across the country, a need for sizeable public funding in education need not be emphasised here.
Realising that only governmental efforts will not yield, some support in the form of incentivizing startups and private companies involved in the re-skilling, and up-skilling of educators.
The new budget should provide flexibility in a way private universities are allowed to use their corpus.
The private and government universities have a huge quantum of funds that are currently deployed only on government securities or other secure funds. They should be allowed to use a certain amount of the funds to invest in PE (Private Equity) and VC (Venture Capital) funds to provide funding to Edtech companies/start-ups and incubates in India.
Edtech companies should be allowed for Government grants for dedicated research/innovation and facilitate global partnership across Edtech companies.
Education-focused NBFCs could be accorded benefits similar to ones given by the RBI to registered NBFC that leads towards agriculture, MSMEs and housing sector as priority sector loans. Subsidies and tax breaks should be given to educational institutions that give out their infrastructural facilities to neighbourhood communities for adult education, life-long learners and sport enthusiasts.
There is a pressing need for educational services to be granted with zero percent GST slab from the current ‘exempt’ category of GST. The above-mentioned ‘exemption’ makes them unable to take the benefit of input credit on several services provided by service providers.
If education services are moved from ‘exempt’ to ‘0 percent’ they will be enabled to claim GST input and reduce the cost of education. There is a need for GST reduction on online courses, reskilling and career counselling and these services that are presently under the 18% slab.
The government should set up good scholarship funds for meritorious students to study abroad in top universities by subsidizing education loans.
The maximum unsecured loans by banks for studying abroad are Rs 7.5 lakhs, too low considering the cost of education and must be raised.
The irony in India is that the interest on education loan is higher that on a car loan.
With high unemployability, it is these online short-term skill courses which could bridge the skill demand-supply gap. There is a need to boost institutions providing courses online. Online courses are not well recognised, are not accredited and the banks don’t lend to finance such courses.
It is thus very crucial for the government to grant infrastructure status to ‘education institutions’, thereby making quality education affordable and accessible for deserving Indian students.
Last year’s budget had made a beginning by announcing a National Policy on Artificial Intelligence. This budget is the time to widen the focus to other emerging technologies such as the IoT, and Machine Learning.
The economy failed to pick up in the passing year despite tax sops to the corporate sector. Higher spending on social sectors like the education, health and infrastructure is an opportunity in the budget to ease the economic situation and alleviate the economic conditions, too.
The focus of the budget for education should be making education affordable to seekers, on easing availability of finances to institutions and lowering regulatory and bureaucratic hurdles to create a student-friendly environment in the country.
