Private investment, especially if it is of a foreign hue, is increasingly being considered a panacea for the evils that overwhelm Indian society from poor infrastructure to poverty and climate change. The latest issue to be singled out for private sector salvation is education. Last week, Human Resource Development Minister Kapil Sibal told the Lok Sabha that foreign direct investment in higher education was a priority.
This and similar earlier statements have provoked a wider debate on greater private participation in education in general. The argument goes that public-private partnerships or PPPs have shown the way forward in a range of industries from telecom to ports and roads, so the government could as well follow the same model for education.
On the face of it, it makes sense for a cash-strapped government, facing a record fiscal deficit this year, to abdicate the space for private investors. The fact that India already has a flourishing private industry in education all along the value chain lends practicality to the point.
The flaw in these seemingly persuasive arguments is that, like health services, commercial measures of profitability cannot be applied to education. One only has to consider the scads of highly profitable private institutes that churn out students of questionable quality to understand this. Ironically, it is graduates from government-run engineering institutes and IIMs that continue to command the highest premiums despite the rash of competing private engineering institutes/B-schools that liberalisation and economic expansion have thrown up.
So, though the private sector will be happy to step in and take up the slack from the government — especially if it gets land and finance at concessional rates — it is uncertain that it will help the government achieve its aims of education for all.
Also, the record of private delivery of public services in India has done little to raise confidence on this score. That is why we have a health paradox that is unique to India: one of the fastest-growing healthcare businesses in the world subsisting beside sub-Saharan health statistics. Rich patients from the West fly to India for world-class, cost-effective treatment that is mostly outside the purview of the average Indian, forget the poor.
The same paradox of access exists in education too. We have both public and private institutions of exceptional quality. The country produces some of the most coveted engineers and business graduates and Indian schooling is now being held up as model by Barack Obama. Yet 40 per cent of its people cannot read or write. Then again, almost half the secondary schools in rural areas are privately managed. Yet rural literacy lags urban rates and dropout rates are higher.
Education also remains one of the fastest-growing businesses in India, but it patently hasn’t solved our education problems. Over the past decade, Indian cities have seen the mushrooming of nursery schools offering affiliations with prominent global brand names but this trend has no noticeable impact on the average Indian child’s access to schooling. It is worth wondering whether foreign educational institutions, eying a fast-growing middle class market, would be eager to fulfil the Indian government’s non-profitable social obligations.
The obvious way of addressing these issues is to link concessions to affirmative action — such as reserving a certain number of seats for students from scheduled castes/tribes or from poor homes. The idea, however, has hardly been a success in healthcare where private hospitals get land and other facilities at discounted rates subject to the reservation of a certain percentage of beds for poor people and so on. A cursory visit to any of these hospitals suggests that this stricture is observed mostly in the breach.
Sibal is well aware of the issues he must confront to address a very real gap between supply and demand for education. In a recent interview, he suggested that the sector will be strictly regulated to preclude fly-by-night operators. But the recent corruption charges against AICTE officials and the patent ineptness of the University Grants Commission hardly raise confidence in government social sector regulators.
On the whole, FDI is probably advisable for higher education. At primary and secondary levels, as both modern western and socialist economies have demonstrated, there is no getting away from solid, secular, state-provided education. This is the hard part and the apathy towards such critical issues was evident in the fact that just 54 Rajya Sabha MPs in a House of 230 took the trouble to stay and pass the Right to Education Bill by voice vote. Leaning on the private sector to solve this problem amounts to little more than inefficiently passing the buck.
