New-Education-Policy-2020-and-its impact-on-Startups-VC-Perspective

New Education Policy 2020, and its impact on Startups; VC Perspective

Government of India announced its New Education policy on 29th of July, 20. This is the first time in 34 years that a new system has been put in place with the aim of taking India forward and building the nation up as the knowledge centre of the world.

What was the need of a comprehensive New Education Policy?

Last education policy was implemented in 1986 and was fit for that time period but in the time that have elapsed since 1984 and today, there has been a drastic change in the Indian economic, sociological and demographic factors so to incorporate those changes and to ensure that the Indian education system stays aligned with the global parallels the New Education Policy was needed.

Education Policy, 1986 has disappointed students, educators and regulators alike. This can be attributed to the inflexible and stringent nature of the policy which failed to account for a future which would be completely different then the present. Nothing expresses this more than the fact that 73% of the class 8 students cannot read beyond class 2 level material and only 44% of them have the numeracy skills to solve basic arithmetic.

The compounding factor here has been the fact that the enrolment in different education layers has increased but the level of education has been washed away. This phenomenon is more alarming with children aged 6 to 14 years, a stage where the base of a student is comprehended and created.

The inability of Education policy, 1986 has in last 34 years have raised some very serious questions regarding the education system in India. Questions like:

a) How to ensure that the students learn basic language and numeracy skills?

b) How to leverage technology in the whole learning process to increase inclusivity & quality?

c) How to improve the quality of teachers who are integral to the whole education system?

d) What are the ways to improve and increase community participation in the Indian education system?

These questions are just the tip of the iceberg and the problem is much deeper than just these above-mentioned questions represent.

Over the years from Education Policy, 1986 to today we have had some good policies that have helped our education system to improve, include and iterate namely the Right to Education Act of 2009 and Sarva Shiksha Abhiyaan of 2001. Sarva Shiksha Abhiyaan has been one of the most successful school education policy ever implemented by the centralgovernment, it also became the pedestal on which RTE 2009 was implemented upon.

These examples of success have been too few and though they have created an impact, but that impact have helped push the enrolment numbers up. To make a comprehensive reform with regards to the whole education arena in the country, a new education policy was much needed.

Some key highlights of the NEP, 20 are:

a) HRD Ministry to be renamed as Education Ministry.

b) Public expenditure on education will be 6% of the GDP.

c) School education system in India will move from the conventional 10+2 Model to 5+3+3+4 Model,i.e., 5 years of primary school, 3 years of preparatory school, 3 years of middle school and 4 years of secondary school.

d) Vocational education will be considered at par as conventional education and will be implemented by class 8th onwards as a part of the curriculum.

e) Internship based learning opportunities from class 6th onwards.

f) KendriyaVidhyalya’s, other government schools and anganwadi’s to provide pre-primary education.

g) Dedicated unit for digital & online learning.

h) Single stream institutions to be phased out by 2040.

i) Massive changes in teaching methodology and a comprehensive new framework called NCFTE 21 to be formulated by NCTE and NCERT to allow for better and improved teachers training.

j)  Focus on teaching in vernacular/local language by compulsion till 5th standard and proposed till 8th standard.

k) Colleges to offer 4-year graduation programmes with research with direct entry to Phd programmes.

These are the few highlights that have become the cornerstone of NEP,2020.

For Edtech startups, NEP is nothing less than a boon. With a move towards vocational education & flexibility in choosing subject lines & streams, NEP opens a whole new market to Edtech startups on both B2B & B2C fronts.

Coupled with NEP in the long term and pandemic induced behavioural changes in the consumer during the short & medium term, Edtech startups are one industry vertical to look out for in the Indian startup ecosystem during the next 5 years.

With schools lacking resources and other capabilities to implement the changes, Edtech startups can partner with schools to help them in implementing the policy, providing them with the necessary expertise to incorporate and leverage tech and by providing them with resources to implement the change in curriculum thus expected.

**Students will now be more inclined to pursue avenues like coding etc as it be now a part of their school curriculum thus giving them more incentive to devote time on portals like Whitehatjr.(acquired by BYJU’s for 300 Million USD) , Vedantu Super Kids &TopprCodr etc.

Apart from the usual arenas we also expect startups to come up in the avenues of career counselling etc. The new system allows for flexibility but with flexibility there could also be uncertainty, students will need more than just parents to ensure that they choose the right path on their way to excellence.

We expect deep tech capabilities to develop in the field in next couple of years.

  • With an onus on digital delivery and the new normal looming for the foreseeable future we expect new startups and the existing ones to explore the unchartered territory early childhood education.
  • Early childhood education has been one area which have never been a focused target of any startup till now. But now with changing social outlook and other factors working in tandem, early childhood education can be a value creating segment for Edtech startups.
  • 14 Startups were successfully able to raise funds in the Edtech space. These included major player like BYJU’s, Unacademy and Vedantu, While other early stage companies like Pedagogy, Camp K 12, Genius Corner, Entri and Wiziclub have also successfully raised funds.

For investors, the policy reassures their confidence in India inc. As the policy is focused on transforming the country in a global knowledge behemoth, investors can for see an army of young entrepreneurs armed with the skill set to tackle the world’s problems.

Indian Edtech sector attracted more than 750 Million USD in the pandemic influenced climate of H1, 2020whichis  20% of the total VC investments in the country during the analysed time period. H1, 2020 is 8x more than the 108 Million USD invested in the sector during the same time period last year.

Major VC’s like Blume Ventures, Sequoia Capital, Omidiyar Networks, SAIF Partners, Nexus and Accel have also invested in the Indian education space in last 2 years.

The policy though pristine is still to be implemented and whether this results in either ground-breaking success or hard felt failure can only be judged by the virtue of time. With long term targets and major changes involved, the implementation of the policy will be difficult, and the diverse nation of the country does not make it that easy. Though we believe that NEP, 20 is a much needed and welcomed reform in Indian education system who we all are products of.

Written by: Ayush Dadhich & Manas Vashishtha

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