With the Indian economy growing at around 9% per annum, various sectors of the economy have started experiencing difficulty in finding skilled personnel. This shortage is being experienced along with wide spread unemployment. It is estimated that the size of the working age population in India, aged 15 to 64 years, is estimated to go up from about 77.5 crore in 2008 to about 95 crore in 2026, i.e. up from 62.9% to 68.4%. India is slated to have the youngest working population in the world. PHD Chamber has emphasized that desired human resource development infrastructure should be made available in the country to help the people to acquire higher education as well as training in employable skills. Failing this, the country may be forced to face a demographic nightmare, social unrest and economic slow down, instead of harnessing a demographic dividend.

Creation of large scale opportunities for higher education as well as skill development in the public as well as the private sector, in a time bound manner, has assumed crucial importance according to Dr. L K Malhotra, President, PHD Chamber. Access to higher education is limited in India, as only about 10% of the relevant age group go to the Universities and a major effort to facilitate expansion and improvement in the quality of our higher education system is awaited. PHD Chambers’ expert group on Education has reiterated that education sector in India continues to experience over regulation, under governance and absence of desired reforms, restricting its potential growth. It has recommended that this sector should be the focus of government reform and development agenda, on a priority basis, as it has been recognized at the highest level of the government that our University system has remained relatively neglected in recent years. “Education including technical education, medical and university; vocational and technical training of labour” are on the concurrent list of the Constitution of India. The Central as well as the State Governments should seriously work towards making India even a global education hub.

PHD Chambers’ expert group on Education has recommended that the 11th Five Year Plan for the education sector must incorporate the milestones for achieving the targets and the objectives of the various schemes, to streamline preparation and timely implementation of all education related programmes. As we are already in the second year of the 11th Plan, greater effort should be made in the initial years of the Plan to take care of even the previous backlog in implementation of the education programme.

According to a study prepared by Boston Consulting Group, a global workforce deficit of the order of 46 million by 2020 is estimated. India would have an estimated surplus manpower of 47 million. This pool of human resource could be used to the economic advantage of the Indian economy, only if education and skill development is given the due importance in our planning.

According to PHD Chamber, the new education infrastructure as announced by the Prime Minister on 15 August 2007- the setting up of thirty new Central Universities to ensure one Central University in every state in the country; five new Indian Institutes of Science Education and Research; eight new Indian Institutes of Technology; seven new Indian Institutes of Management, and twenty new Indian Institutes of Information Technology should be ready to enroll students as per a time bound programme. These new institutions are to be set up as a part of the 11th Five Year Plan. Almost after seven months of the PM’s announcement, the Union HRD Ministry announced on 29 March 2008 the names of the states where the new IIMs and IITs would be set up. The exact locations of these institutions has yet to be decided, as the state governments have to identify 500 acres of contiguous land for setting up the campus. The Office of the Prime Minister would do well to regularly monitor the implementation of these projects, recommends PHD Chamber. Moreover the momentum of this programme should not be lost even with any change in government after the general elections next year.

For sustained and inclusive economic growth it is extremely important that education should receive the rightful priority in the allocation of resources and a serious attention in programme implementation and reforms, so as to address existing deficiencies in terms of the availability of higher education programmes in all parts of the country; quality of education in the some of our Universities, the disturbing regional disparities, and relatively limited range and reach of the education programme. All these offer immense challenge and opportunities for growth.

Our National Policy on Education (1986) had set a goal of expenditure on education to be of the order of 6% of GDP. However, the actual expenditure on education as a percentage of GDP has remained below 4% of GDP till 2006-07. The National Knowledge Commission’s recent report on higher education has recommended that the present support for higher education should be at least 1.5% of GDP, from a total of 6% of GDP for education. PHD Chamber while expressing concern that the present government support for higher education is only 0.7% of GDP, has recommended for much higher allocation of funds to higher education for a nation having half of its population below the age of 25 years.

Estimates suggest that around 16,000 Indian students studying abroad, spending nearly Rs 18,400 crore per annum could also be looked as a potential source of finance for the India education sector, by creating more opportunities within the country.

According to the figures from the Controller General of Accounts, the revenue collection by the government through the education cess, amounted to Rs 5557.58 crore in the year 2004-05, Rs 7322.82 crore in 2005-06, and Rs 9466.5 crore in 2006-07. With the availability of this non-lapsable ‘dedicated fund’ for improving access and standard of primary education, the government should be able to spend significantly higher resources for strengthening of higher education. Moreover, the Ministry of Human Resource Development should come out with a detailed report on the impact of the education programme funded through the education cess and its future preparedness to efficiently utilize this fund. The annual outcome budget presented by the Union Minister for Finance should also clearly throw light on the outcome of the utilization of the dedicated fund created by the imposition of this special cess.

To give renewed thrust to strengthening of education including higher education as well as skill development, the Government of India should consider expeditiously formulating a New Education policy, keeping in mind the emerging demographic, social and economic environment. The states should also formulate their own education policy in line with the National Policy on Education with special focus to the requirements and potential of their respective states. Checking the latest official websites of all the state governments in northern India, it is found that only Haryana announced its Education Policy in 2000. Rest of the states, such as Chhattisgarh, Delhi, H.P., J&K, M.P., Punjab, Rajasthan, Uttarakhand, U.P. and UT of Chandigarh have only formulated Policy for IT & ITES development. While it is of great economic advantage to develop manpower for IT and related services, other sectors of the economy also offer immense opportunities for employment and deserve planning for manpower development.

Our education sector is awaiting major reform initiatives; so as to witness substantial expansion of infrastructure, achieve higher efficiency in public expenditure and mobilization of sizeable private investments in the sector, according to PHD Chamber.




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