Project Background
Very few people in India today are aware that 46 % of India Bihar , for instance just 21 % of teachers have passed their class X exams. These are official government statistics published by the New Delhi
Given an average student / teacher ratio of between 60–80 , this means that an extremely large number of children , in tens of millions , are studying under teachers who themselves are not properly qualified.
What is very surprising is that the National Knowledge Commission ( NKC ) in its 2008 report on school education did not find the above mentioned teacher related statistics “ important enough “ to place before the people of India. By withholding this vital information regarding the very serious state of affairs in teacher quality and by failing to incorporate this information while recommending a national strategy in primary education, the NKC and the Ministry of HRD have actually misled the nation into believing that the governments Sarva Shiksha Abhiyaan ( SSA ) is sustainable , which it is not.
It needs to be understood very clearly by everyone that given the above teacher quality issues within the SSA, if any attempt is made to expand the system by bringing in more qualified teachers , there will be very serious Human Resourse problems ( read “ riots “ ) and system wide failures within the existing school system as 2.16 Million teachers go on strike.
It goes without saying that Indian GDP growth will also stall, thereby putting an end of the India
Teacher Quality Within SSA … An Issue for The Home Ministry / Ministry Of Defence
The problem is actually far more serious because teacher quality within the Sarva Shiksha Abhiyaan has now moved beyond the Ministry of HRD. Teacher quality is now a matter for the Ministry of Finance and the Ministry of Commerce, since it will limit India
All the above is true because within the next 6 – 8 years over 100 million children will exit the school going age group without any employable skills. These young people will have no future to look forward to when they get to 15 years of age in 2016 because the Planning Commission , the NKC and officials within the Ministry of HRD withheld vital information in their 2008 report to the Prime Minister and the UPA government.
Designing A Solution … The Education Megaproject
The Indian Education Megaproject is a pathbreaking initiative which seeks to set up 30,000 New schools with a capacity of 600 students each, across 28 states and 7 Union Territories
Need For a “ Teacher Centric “ Project
There is a reason for poor teacher quality in India India
A need was therefore felt to design a project that would attract the best minds back to careers in teaching , thereby correcting a Macro imbalance that threatens our society. To correct this imbalance, the Megaproject will attract its 1.74 Million graduate teachers from other professions by offering them elegant housing, attractive salaries ( especially in rural areas ), excellent growth prospects including overseas assignments and a 3 bedroom house and free medical treatment for the teacher and his / her family on retirement. This “ Teacher Centric ” design of the project makes it conceptually very different from the current “ literacy centric ” approach of the Sarva Shiksha Abhiyaan ( SSA ), the flagship initiative of the Govt. Of India
A massive advertising campaign with a budget of Rs 800 Crores over a 6 year period and an army of ten thousand executive search consultants on a commission basis , will be deployed to find the 1.74 Million graduates from other professions to be teachers in the 30,000 new schools. These people will be gauged for teaching aptitude and then put through a short intensive course before being posted to the schools.
As per the projects design basis document, 15 % of the 30,000 New schools ( 4500 schools ) will be fully residential schools of the Rishi valley class and 85 % ( 25,500 schools ) will be day schools. In all cases however ( both day schools and residential schools ) , the project will provide excellent housing for all teachers.
The scheme as designed , will also implement a massive teacher sharing programme within which each of the 30,000 New hub schools with share it’s teachers with 14 other existing SSA schools in it’s area . All the Megaproject’s schools will be overstaffed by design to achieve this teacher sharing with the SSA. For example if at a teacher / student ratio of 1:20 , a school needs 30 teachers, it will actually be staffed with 60 teachers. Elegant guest houses of the Auroville / Laurie Baker design will also be built in each of the 14 villages clusters that the hub school serves to effectively implement the teacher sharing programme. In this manner a total of 126 Million Children will be provided with access to qualified teachers. It is being assumed that each village cluster will have 250 - 300 children who will be covered . The numbers will vary across India
Focus of the project is on providing locally relevant knowledge suited to the needs of the local rural economy . Special attention will be on the development of local languages ( There is a Rs 28,000 Crores budget for this ) so that a majority of the rural population can participate in the growth of the economy. This will maximize the rural economy and stop the large scale migration that is taking place to already crowded cities, where rural migration is adding to the growth of slums.
Project Cost
The project as designed has a Capital cost of US $ 131.38 Billion ( Rs. 5,97,651 Crores ) and an Operations cost is US $ 42.57 Billion ( Rs. 1,93,633 Crores ) each year after 2023. Please note that these Opex numbers are within a US $ 4.5 +Trillion Economy that India
Construction Phase & Operations Phase Financing
Given the fact that the central government as well as most state governments are running fiscal deficits in excess of 4 % – 5 % , it was not practical to expect any government ( Central or State ) to finance a large Capex programme in education and other means had to be found. The project therefore had to innovate by tapping into hitherto untapped new sources of funds through the creation of new financial and legal structures.
To arrive at an appropriate financing mix , the designers studied a number of options and numerous recommendations made by various Indian and Foreign Experts. We were however not able to find large enough pools of finance in all the material we went through. The projects design team therefore started looking at all kinds of possibilities because without the money we did not have a project to talk about.
Finally we have been able to put together a list of possible financing options. For a proper understanding of the thinking behind this list we would like to direct our readers to Annexure I ( Sources of finance and related assumptions ) within the project concept document which can be downloaded for free from the Nataraja Foundation’s website http://www.nataraja.org.in/masseducationproject.htm .
The Megaproject’s list of sources of finance ( described in detail in the concept document ) is as follows :
- Expanded GST … 10 % of delta additional receivables to be securitized
- 30 % of a proposed new tax on the services component in future Infrastructure projects
- A Graduate Tax payable by Employers In India
- A Quantized Tobin Tax on Forex Transactions
- Urban Equity Withdrawal from
PSU Land - Yearly Rent From Re-developed
PSU Land - Teacher / Content Outsourcing Business
- Domestic Students on Fractional Vouchers / NRI Quota and SAARC / Foreign Students
- Un-Utilized Funds with various Ministries and NGO's
- Equity Infusion By Promoter groups for 25,500 Day Schools and 4500
Residential Schools - Committed and Un-Utilized Funds Lying with the World bank and the Asian Development Bank
- Service Tax Feedback from a US $ 45 Billion / year new education business due to the Megaproject
- 1 % of
India - Dis-investment proceeds from Public Sector and Bank privatizations … This is a backup source … not active within Rev 03.
From a financial design standpoint, we imagined the needs and the financial capability of the Indian economy in 2023 and then worked backwards to arrive at the above list of possible sources of finance that would be effective in raising US $ 131.38 Billion ( Rs. 5,97,651 Crores ) over the 10 year construction phase and then US $ 42.57 Billion ( Rs. 1,93,633 Crores ) each year after 2023 .
The Planning fraternity in India India
Finding possible financing sources is however just a part of the problem. These sources, once identified, need to be deployed within a proper financial structure to make the Megaproject hum to life. The key challenge was to look for something that had worked in India
Accordingly , the Megaproject has adopted the same financial structure that was used previously for the construction of the Golden Quadrangle Project / National Highways projects. Under this framework , Parliament will enact two special legislations to give birth to a legal structure consisting of :
- A Statutory Organization “The Indian Social Infrastructure Corporation ( ISIC ) ” which will function as the nodal agency / SPV for setting up the Education Megaproject outside of the ministry of HRD.
2. A statutory fund named “ The Indian Education Megaproject Fund “ as suggested by Dr. Urjit Patel ( on the lines of the “Central Road Fund , which has previously helped to successfully finance the Golden Quadrangle project ).
The above two elements of the financial and legal framework are critical to the fast track execution of the Megaproject totally free of politics at the centre and within the states. If the above mentioned 14 sources of finance are married to the financial structure there will be no need to divert any money from existing and planned Central and State Government budgets. There will also be no need for donor funds as the 30,000 individual school projects will be executed in Public Private Partnership ( PPP ) mode.
The entire Megaproject System will be controlled and financed in the Operations phase through a system of Vouchers which will be won by children through a national exam. The project has a system of metrics to ensure that the poorest child wins the voucher for the same score on the aptitude test. The value of each voucher actually includes the cost of covering ( 1 + 14 ) children. So effectively 126 Million children will receive education totally free of cost. The Voucher System will also run on a sophisticated communications platform which will be self regulating and foolproof so this PPP project system will not need as much monitoring as the SSA.
The project is targeting 1st January 2014 as the launch date of its first Public Private Partnership , PPP bidding round ( out of a total of 4 bidding rounds ), when the first lot of 3000 concessions will be awarded to private developers in rural areas in 6 states ( Phase I Target states ) with the highest percentage of out of school children. These states are Bihar, Uttar Pradesh, Rajasthan, Madhya Pradesh, Andhra Pradesh and West Bengal .
Proposed Forward Path … Setting Up Pilot Projects
As stated earlier, over the next 6 – 8 years , over 100 Million children are going to exit the school going age bracket in India
Given this serious situation in Indian Education , it is proposed to set up 70 Pilot projects ( 1 day school + 1 fully residential school ) in each of 28 states and 7 Union Territories
A presentation was made regarding the project in October 2010 to some senior members of parliament who represent a total of 115 MP’s . The project can therefore claim the total support of slightly more than 1/5th of the elected members of the Lok Sabha. The Nataraja Foundation is also talking to a number of state governments and there have been encouraging signs from 3 state governments who might be willing to finance a total of 90 Pilot projects in as many districts. There has however been no direct response and no interest shown in this massive Education Project for Universalisation of post primary and Secondary Education in Rural areas from anyone in the Planning Commission , the NKC or the Ministry of HRD, though all these organizations and all its senior officers have been approached several times since May 2009.
Ashish Puntambekar
Project Designer
The entire project with all its documents (Project presentation,Concept document, detailed calculations etc. ) can be downloaded for free from the project website http://www.nataraja.org.in/masseducationproject.htm
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