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Education Sector in India

September, 2013


In India, education is the key to the task of nation-building. It is also a well-accepted fact that providing the right knowledge and skills to the youth can ensure the overall national progress and economic growth. The Indian education system recognizes the role of education in instilling the values of secularism, egalitarianism, respect for democratic traditions and civil liberties and quest for justice.

There is a huge demand for upgradation of education as India is expected to have a surplus of 47 million people in the working age group by 2020. As a result, both the formal education sector (including K-12 and higher education) as well as informal sector (including coaching institutions, pre-schools and vocational institutions) are witnessing rapid growth.

Market Size

The market size of Indian education sector is expected to increase to Rs 602,410 crore (US$ 95.80 billion) by FY15 on back of strong demand for quality education, according to a report by India Ratings. Indian education sector’s market size in FY12 was estimated to be Rs 341,180 crore (US$ 54.20 billion). The sector grew at a compounded annual growth rate (CAGR) of 16.5 per cent during FY05-FY12.

India's online education market size is set to grow to US$ 40 billion by 2017 from the present US$ 20 billion, said Mr Anil Sonkar, Chief Technology Officer (CTO), LoudCloud Systems.

The private education sector is estimated to reach US$ 70 billion by 2013 and US$ 115 billion by 2018, according to a consulting firm Technopak. Realising the fast growth of education sector in India, many private companies are looking for relevant acquisitions and alliances in this space. Major investments are being seen in the areas of pre-schools, private coaching and tutoring, teacher training, the development and provision of multimedia content, educational software development, skill enhancement, IT training and e-learning.


The education sector in India is also considered as one of the major areas for investments as the entire education system is going through a process of overhaul, according to a report ‘Emerging Opportunities for Private and Foreign Participants in Higher Education’ by PricewaterhouseCoopers (PwC).

The education sector has attracted foreign direct investments (FDI) worth Rs 4,483.06 crore during April 2000 to July 2013, according to the data released by the Department of Industrial Policy and Promotion (DIPP).

Some of the major investments in education and training sector in India are as follows:

  • The UK-based University of Northampton has tied up with Madras University to offer a Master's degree in International Environment Management. The course will allow students access to online courseware put up by the University of Northampton
  • Ecole hoteliere de Lausanne has opened a 67,000 square feet campus in India to tap into the growing demand for skilled hospitality professionals in the country. Located in the newly developed Lavasa township near Pune, Ecole Hoteliere Lavasa will offer a four-year programme
  • Narsee Monjee Institute of Management Studies (NMIMS) has set up a centre for manufacturing excellence in collaboration with UK's Warwick University. The centre will offer specially designed Master's and Doctoral programmes
  • CFA Institute, the global association of investment professionals, plans to set up office in India for its CFA and Claritas programmes
  • India's first ever aviation university would come up at Rae Bareli in Uttar Pradesh (UP). The Rajiv Gandhi National Aviation University will commence training of aspiring pilots, aircraft engineers and cabin crew in September 2014
  • Tech Mahindra has established an engineering college in association with the French university, Ecole Centrale and Jawaharlal Nehru Technological University (JNTU)
  • EuroKids, education service provider in the pre-school segment, launched 'EuroVarsity', a virtual university aimed at providing programs to develop teaching skill sets. The first course to be offered is a certified teacher training course, 'diploma in early childhood care and education'