Print Edition - 2017-06-21  |  The Collegian

Soaring high

  • With parents and students seeking competitive international-standard education, investment in Higher Secondary schools is on the up

Jun 21, 2017-

With the ever growing need and demand for quality education, investment in the education sector has become safe bet, and thus, has increased significantly in the past decade. Education is among the few sectors that has witnessed exponential growth over this period. 

The fact that education sector commands around 10 percent stake in Nepal’s advertisement market speaks volumes on how the sector is getting corporatised and is becoming a money spinner for the country’s private sector. According to the Advertising Association of Nepal (AAN), it is estimated that the country’s annual advertising market is worth Rs6 billion. This means, the education sector alone contributes around Rs60 million annually to the advertisement business. 

As education is considered a service-oriented sector, this amount is staggering. And it goes on to shows how vibrant the sector has become from a business point of view. Sensing huge opportunities, business conglomerates like Chaudhary Group and Kedia Organization, among others, have forayed into the sector. The entry of such big corporate houses has made the sector competitive, so much so that the school segment (from grade X to XII) today is estimated of having an investment worth more than Rs10 billion. 

“The sector has indeed become competitive and that has benefitted students, as well as parents,” Ramesh Silwal, president of Higher Institutions and Secondary Schools’ Association Nepal (Hissan) said, adding that the rise in investment has contributed in the betterment of teaching and learning methodologies. 

Silwal admits that there has been a tendency of ‘pageantry’ among education institutions, particularly in 10+2, in the recent past, which is also one of the reason behind the significant rise in investment. “The scenario has changed now. Hissan members have agreed to maintain a low key in promotions and focus on quality education,” Silwal said. 

The change in scenario, according to Silwal, can be explained through the fact that the cost of +2 level education hasn’t increased compared with school level education (from grade I to X). “Admission fees of some of the schools in the country is enough to complete a year in most of the +2s today,” Silwal said, adding that +2 level science, management and humanities course can be completed at an annual tuition fees of around Rs 150,000 (Science) and Rs50,000,  Rs75,000 for Management and Humanities respectively depending upon the institution. 

Industry insiders say an average investment of Rs7.5 million is required for a college to make a modest beginning in plus two (10+2) level education. Given that private schools today are not just limited to teaching and learning, upcoming institution have to also ensure heavy investment in infrastructure development as well. From large playgrounds to top notch ambience, laboratories and library, the private sector has left no stone unturned in order to meet the expectation of a modern day approach, ensuring a holistic development of students. Classrooms are being turned into multimedia platforms for enhancing learning capabilities as well. 

Likewise, apart from direct investment, a number of industries and businesses like stationary, book shops and uniform stores, among others, have been benefitting due to the proliferation of the education sector. 

The ratio of students studying in +2 level in Kathmandu and the rest of country, according to industry insiders, stands at 50:50. This means large number of students from across the country flock in to the capital city. Private sector players say it is important for them to invest towards living up to the expectation of the students who migrate from their native towns and villages for quality education. 

According to Hissan, there are around 3,800 +2 schools in the country at the moment. Around 3,700 schools are estimated to be functional at present. 1,200 schools out of 3,700 are operated by the  private sector. The remaining 2,500 schools are either community schools or are run by the government. 

With the Secondary Education Examination result published recently, around 400,000 students will be joining +2 level education in the next few weeks. There were around a million students who appeared in National Examination Board. 

This shows the immense scope for academic institutions in the +2 level. While the private sector has striven to tap this potential market, government and community schools at large remain lagging behind. 

The entry of corporate houses into education sector, according to Silwal, is a good sign for the country. “However, Corporate houses should focus in quality, reputation and credibility rather than seeking profit,” he said, adding that corporate houses that have forayed into the sector haven’t succeeded leaving a notable mark thus far. 

Though Silwal claims that the education cost in the +2 level hasn’t increased, affordability stands among the major issues for students as well as parents. Declining affordability due to increasing inflation, however, has received huge boost from huge the inflow of remittance in the country. With the increase in remittance inflow, people living even in the remote parts of the country do not shy away spending on quality education. In the fiscal year 2015-16, Nepal received remittance worth Rs 665 billion. Remittance accounts for 30 percent of country’s Gross Domestic Product (GDP) as of last fiscal year, according to the Nepal Rastra Bank.  

Increasing expenditure capacity of people living in remote areas of the country is also prompting the private sector to see opportunities beyond Kathmandu. According to Hissan, the fact that ratio of +2 schools in Kathmandu and rest of the country is balanced on an equal ratio in itself shows the evolving scenario and that the private sector too is eyeing to tap possible markets all across the country.

Published: 21-06-2017 10:14

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