EdTech & Educational sector expectations from Budget 2022: As Union Finance Minister Nirmala Sitharaman is all set to present India’s billion dollar budget on February 1, 2022.
Here’s what the Edtech startups & Educational sector expects from Finance Minister Nirmala Sitharaman:
Swati Ganguly, Co-Founder, Edufiq:
The Union Budget 2022 should consider multifaceted improvements for this upcoming budget Such as Affordable or subsidized schemes for Internet Connectivity & Student Devices in Tier 3 and 4 cities. A reduction of GST to 5% in EdTech will encourage SME start-ups for innovations in Skill Development. Recognizing the potential of technologies like Artificial Intelligence, Data Science and Machine Learning to engage young learners to pursue careers is a long-term dividend on “Skill Development for young learners”.
Deepak Mittal, CEO & Co-founder TO THE NEW:
It would be beneficial for our industry if the Budget also directs some resources on building a robust e-learning ecosystem, implementing online innovation, and scouting suitable technological tools to enhance the online learning ecosystem. We are eager for this year’s Budget announcement and what it has in store for this industry.
Vaibhav Singh, Co-Founder, Leap Scholar:
The Edtech sector has flourished and grown multi-fold in the past year at an accelerated rate and has seen higher investments across the spectrum. India is currently home to the highest number of study abroad aspirants in the world with an estimated 1.3 to 1.4 million students appearing for competitive exams like IELTS and TOEFL every year. This figure will increase exponentially this year as more and more students aspire for global education and careers.
The 2022 budget is expected to have a greater focus on the edtech sector as a whole, with significant investments to enhance greater access to robust and improved digital infrastructure and also better tax incentives.
Sharad Bansal, Co- Founder, Tinkerly:
With the country witnessing the 3rd wave of Covid, online classes have become mainstream now but they currently come under 18% GST slab. Relaxation on GST for online classes and STEM toys will encourage more enrollments of interested students. Due to COVID, we saw the demand-supply gap and it is crucial to bridge the gap by providing internet connectivity, better infrastructure in tier 3 and tier 4 cities, and running schemes like One student One laptop, scholarships should be provided for outstanding performances. Technical and soft skills training should be made mandatory for teachers. They should be trained to teach and maintain the engagement of the students in online classes. A provision of budget can be made under SSA for the same. Funds and disbursements to Atal tinkering Labs should be speeded up to improve the quality of education.
Currently only schools can get grants for Atal Tinkering Labs, this should be extended to private learning centres and independent educators so that community driven Tinkering Labs can be established. We strongly believe Futuristic tech skills such as IoT, AI, coding should be included in the curriculum. Currently India’s government expenditure on education per child studying in government schools is significantly higher than the private education spent per child studying in private schools. This inefficiency can be reduced by providing Vouchers for direct education with the liberty to choose where and how to spend it. As mentioned in NEP 2020, the foundational pillars of technology such as equity, access, quality, affordability, and accountability should be leveraged and imposed.
Sourabh Gupta, Founder & Design Dean, The Design Village Noida:
Education sector is one of the most impacted sectors because of the pandemic and is in direct need of support from the Government. The finance ministry along with state governments should look at initiatives that will further help students whose families have been affected with scholarships and flexible and low interest education loans. This will help to curb the current attrition in the education sector. To strengthen India’s promising EdTech and digital start-up ecosystem, we expect the government to provide better internet infrastructure, robust data protection systems and more tax exemptions in the upcoming Union Budget. In addition, mental health counseling should become an essential part of institutes to help children cope with the ill effects of COVID 19. The budget must provide for this and should focus on interventions towards retention of students in the education system.
Karanvir Singh, Founder & CEO, Pariksha:
In the current times, to build a successful startup one needs to have a strong team. However, retaining talent is not as easy when you are running a young business. In order to be able to attract and retain talent a lot of startups started offering ESOPs.
We really would like the government to consider the tax structure on ESOPS, such that it be taxed only at the time of sales and not at the time of exercising, as the case currently is. Additionally, a centralised Professional Tax system on the lines of GST will further help, and increase the ease of business for startups operating in multiple states.
Sahil Miglani, Co-Founder, Geekster:
The Pandemic has changed the way learning happens and fast-forwarded the adoption of online education by 5-10 years. Delivering quality education to every town and village of the country is now possible, provided we improve the digital infrastructure. We expect the Government to revisit the high GST on education related services, and overall higher budget allocation to this sector
Rachit Agrawal, Co-founder & Director, AdmitKard:
This budget we expect to see the Indian economy moving it’s focus to build stronger capabilities in the school infrastructure to enable the hybrid model of education which has become essential in the recurring pandemic scenario. Additionally, early education needs to get more tech enabled and we expect that should work in favor of the EdTech community. Further, there should be greater emphasis on skills and language training in order to make Indian youth ready for the global economy, and encouraging more Indians to migrate for work or studies.
Himanshu Tyagi, CEO & Founder, Digikull:
In India, any skill development related service must come under the lowest tax slab. The government should revisit the 18% GST on skilling, which is very demotivating for the students who want to gain skill-related education. Even the loans related to education must be provided for lower interest rates. Only then will we be able to say that in India the policies are encouraging towards education and literacy. During the pandemic too the edtech played a vital role in keeping the show running for education institutes. Now they need the Budget to consider a decent allocation to the sector to suffice for long term tax exemption, technology and accessibility.
Rishabh Khanna, Cognitive Scientist & Co-founder, Suraasa:
The world has seen a change in the way we live. Education specifically has taken a new direction that has made technology based learning, whether online or blended, indispensable for our education systems. Over 1 crore teachers of the country have pushed themselves to embed technology in their teaching systems and they need support in developing their capability on new age teaching methods.
I think that we should allocate a part of this education budget specifically to solve this need. After all, teachers are leaders in a classroom and our students can learn effectively only if teachers are able to interact with them on the same wavelength. The education budget this year could define the way forward for us as a country and for the entire education system. Looking forward to the union budget.
Shashank Pandey, Co-founder, ConveGenius:
Building a solid digital education ecosystem that enables skilling is a sure-fire way to combat the current pandemic. The NEP-2020 initiated significant changes in the Education System of our country – it created a niche for EdTech, permitted flexibility in the learning curve, and emphasised blended learning. With the government’s numerous laudable steps to build an e-learning ecosystem, India still requires a lot to educate its youth, and the upcoming union budget may open doors to the facilitators working diligently to bring educational equity to this #NayaBharat.
I hope the upcoming Union Budget would support the perfect blending of digital & traditional education and strive to encourage the adoption of emerging technologies. Moreover, the government should make more efforts to engage in Artificial Intelligence, Machine Learning, and Data Science training sessions at the grassroots level and build up capacities and acumen for new-age tech domains in educational institutions.Another important aspect to be considered is improved internet connectivity infrastructure across the nation that promotes last-mile access, affordable 5G devices, and most importantly helps EdTech companies with strong data protection laws.
Madhu Agrawal, Co-founder, Clever Harvey:
The last two years of the pandemic have been full of ups and downs for many industries worldwide and needless to say, the education industry isn’t spared either. While Edtech has seen a significant boom, there are factors that still need to be reconsidered by the Government of India in the upcoming Union Budget that can help boost the edtech industry which is the future of education.
According to us, one of the key areas of concern for all edtech companies is the disparity in the GST treatment of print educational solutions vs digital educational solutions. For example, a textbook is charged 5% GST whereas the same book in an online format is charged 18% GST. We’ve seen the potential of online educational material increasing access to education and the quality of education. We are expecting this GST should be reduced so that more people can invest in digital education. We hope that the Government of India reconsiders this in the upcoming budget announcement and builds a fair and equivalent system for offline as well as online education providers.
Ujjwal Singh, CEO & President, Infinity Learn:
To address the rising demand for digital learning, the EdTech industry has embraced new technology and resources. EdTech companies in India are creating effective solutions and serving as vehicles for socioeconomic development and transformation through innovation and scalable technology. The use of technology in education, or digitalization, has aided the spread of quality education throughout the country, particularly in Tier 2 and Tier 3 cities. EdTech companies have helped to democratize access to high-quality education and improve student engagement by using technology technologies. For its expansion, the industry is looking for government help. Ramping up of digital infrastructure is the top demand of the edtech sector. Because of infrastructure issues, cities in Tier 3 and Tier 4 struggled with online education.
We also expect the government to recognize Edtech as an industry group, allowing it to engage in decentralizing learning at all levels and reconsidering the taxation of ESOPs. For a fair and equal system for offline and online education providers, the government should cut GST on online learning and materials. Infinity Learn by Sri Chaitanya believes in harnessing educational technologies to meet the country’s ever-increasing demand for both online and offline, as well as collaborating with the government to reduce learning loss and develop a New India.
Abhinav Mital, Founder, The WorldGrad:
GST reductions will be highly appreciated by the students and the education sector; the cost of upskilling makes premier opportunities inaccessible for the students in addition to the mental stress and financial burden it puts on them. Though core education for degrees and diplomas is GST-free; however, allied services or education empowerment in the form of certificates, online learning courses, and other such opportunities are not.
The government should provide significant & sizable assistance to students by lowering the 18% GST on education services and associated categories, decreasing their direct financial strain by 10-15%, and encouraging more individuals to upskill themselves to better prepare for successful careers and growth of the nation. Moreover, education facilitation should be viewed as a significant contribution to overall educational achievement.
Dr Manoj Singh, CEO, RUBIKA India:
National Education Policy, 2020 (NEP) demonstrated commitment to the educational reforms and reaffirmed the recommendation of increasing public investment on education to 6% of GDP as recommended earlier in NEP in 1968.This will be a welcomed move but budgetary allocation merits detailing and attention. The budget should prioritize funding for R&D in both public and private institutions. The cabinet is expected to make sufficient amendments to strengthen the current learning ecosystem by bridging the digital divide through appropriate infrastructural developments.
Additionally, the budget is projected to provide some form of financial assistance to the private sector, such as low-interest loans. Such an endeavor has already been taken in several countries, encouraging private institutes to adopt new teaching methods and provide students with unique courses. The budget should also consider establishing a ‘National Education Bank,’ like the ‘National Housing Bank,’ to give education loans at the lowest possible interest rate. The budget should also have more initiatives like the National Educational Alliance for Technology (NEAT) so that skill-oriented courses like animation and design can be introduced at all school levels in view of the growing demand in the creative industries such as AVGC, Media, Adv, PR, etc.
Also, the government must look at capacity building by encouraging institutions/ universities offering such creative courses. The government should also look at providing research incentives to encourage academia-industry collaboration, as well as research credits for multidisciplinary research and pedagogical implementation. This will assist the country in capitalizing on global prospects due to the demographic dividends. Another expectation from the budget is reduction in the GST slab for education from 18% to 5% so that more people can invest in education and help shape a brighter future. The Govt should look at providing research incentives to encourage academia-industry collaboration, as well as research credits for multidisciplinary research and pedagogical implementation.
Nishant Agarwal, Founder, Proctur:
The education industry has swiftly shifted in the last two years as students and instructors turn to digital learning during the COVID-19 epidemic. Although budget 2021 was adequate in light of the digital revolution, budget 2022 is predicted to be a more advanced and strong budget with appropriate tax incentives, a solid network infrastructure, and strict data protection regulations, which might alter the educational IT industry.
In addition, to address the increased demand for at-home learning, the edtech sector has adopted new technology and approaches. However, online classes were hampered by an adequate internet connection, digital devices, or computer systems. The edtech ecosystem anticipates that the government will make government services available to both applicants and edtech companies. The next budget is projected to place a greater emphasis on improving internet connectivity infrastructure across the country, promoting last-mile access, inexpensive 5G devices, and, most crucially, assisting EdTech enterprises with robust data protection legislation.”
The progress in GST treatment is another essential expectation for Budget 2022. One of the most critical areas which required improvement, in my opinion, is the GST treatment of print vs digital educational products. We’ve seen how online educational content has the potential to improve educational access and quality. From this year’s budget, there is a hope that the GST will be cut, allowing more individuals to invest in digital education.
Vivek Sunder, CEO, Cuemath:
Given 2 years of pandemic and school closures, a whole generation of young kids would have messed up fundamentals and been passed to the next grade. We should do Academic Year 2022-23 as one where the government is encouraging and enabling foundation strengthening on core subjects like maths to help kids who have slipped to come back. Especially for low income but high potential kids.
Siddhartha Gupta, CEO, Mercer:
As the pandemic turns into an endemic, and we move into a disrupted world, education is one service that needs to be provided uninterrupted. Over the past two years, our Ed-Tech sector has proven that it has the capability to do so. Therefore, the need of the hour is that the Government and the Ed-Tech sector must come together to collaborate, establish a framework, guidelines and clearly define the modus operandi for digitizing education. Emphasis should be on enhancing our digital and physical infrastructure. In addition, our education curriculum needs a rethink.
The aim should be to impart employable, digital, and flexible skills with the focus on skilling, reskilling, and upskilling if we want our youth to participate in a data-driven digital economy that is perpetually evolving because of the digitization process and the great resignation.
Furthermore, as online exams become the norm, official guidelines and frameworks need to be established. If we are to compete globally with other economies, then our education sector is key. Therefore, there is also a need for innovation and liberalization of the education sector. However, that is only possible through integrating and strengthening our big data and AI capabilities.