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Budget 2017 lacks clarity on educational initiatives, say ed-tech startups

ThinkstockPhotos-458843583In the Union Budget 2017-18, the government outlined its efforts to digitise education and make it available for all. The startup fraternity, particularly ed-tech firms, is far from impressed.

One of the initiatives includes the creation of a Swayam platform, which would allow students to avail of online courses. The information technology-enabled platform is slated to be launched with 350 courses, although there is no specific timeline for its launch.

In addition to the e-learning tool, finance minister Arun Jaitley also announced the creation of an Innovation Fund for secondary education, which aims to encourage local innovation to ensure universal access, gender parity and quality improvement, using IT.

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“The Innovation Fund seems to be on the policy level, but it could support some firms which help in learning outcomes and administration. But I don’t see it as a big driver for startups. The approach taken by the government regarding Swayam will determine how it can help entrepreneurs,” said Narayanan Ramaswamy, partner and head, education and skill development at KPMG India.

Many ed-tech startups felt that Jaitley failed to highlight how the government would support them or use their technology for its education initiative.

“We anticipated an announcement where the government would open international centres to give global access to Indian ed-tech companies. While the budget gives Indian youth access to global jobs, the social-political environment overseas is not in our control,” said Rishi Kapal, global strategist and chief executive at EduGild, an ed-tech startup accelerator.

Kapal also said that Jaitley was silent on how India will be made a world-class education destination with campuses adopting augmented reality, virtual reality, neuro-linguistic programming and artificial intelligence solutions and services.

While the Swayam platform is largely appreciated, creating thousands of courses and putting them online in multiple languages is an arduous task, and might take the government years to accomplish, say industry insiders. Hence, it makes sense for them to look at partnerships outside and support startups to fulfil its intent of creating an efficient educational network.

“I am waiting for the fine print from the government on how institutions such as the University Grants Commission (UGC) can partner with startups in the education technology space. I feel the government realises that everything cannot be done in-house, whether it’s about upscaling, creating curriculum, or carrying out examinations,” said Vipin Agrawal, founder of Online Tyari, a test preparation startup.

However, the government is yet to develop a concrete action plan to bring in private enterprises that are successfully operating in the education technology space, said Priya Mohan, co-founder of Vidyartha, a learning guidance platform.

Jaideep Kulkarni, partner for tax and regulatory services at consultancy firm EY feels that with Swayam being free of charge, it could become a more preferred option in a price-sensitive country like India, as compared to other startups.

Founders say such schemes should be system-driven and free of procedural bottlenecks. “A case in point was the Startup India initiative which saw very limited traction. The complex approval process involved a lot of human intervention and discretionary powers, which opened the way for red-tape and corruption,” said Devendra Agrawal, ‎founder and chief executive at Dexter Capital Advisors, a boutique investment bank.

Besides this, limited Internet connectivity and reluctance among parents and students to pay for online education hamper both startups and the government in their initiatives towards education, said the founders.

The market size of the online supplemental education opportunity in India is expected to touch $2.5 billion in 2016 and is poised to grow at 15% over the next three years, driven by innovative ways of delivering courses and study material by players in the space, a report by research and advisory firm RedSeer Consulting stated last year.