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Economic growth and higher education in India and China

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In Brief

In the early 1980s, India had quantitatively and qualitatively more infrastructure than China. Until last decade, India’s higher education outperformed its Chinese counterpart — both quantitatively and qualitatively — and China retained its long-term lead in primary education. But the situation is altogether different today, as China now dominates in ‘soft infrastructure’ areas too, which include higher education.

Higher Education development in India and China closely parallels their economic growth over the last couple of decades.


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Higher education in India struggles with moderate reactive growth, whereas China achieves higher growth and is proactive in its goals; in no small measure, this derives from the fact that the Chinese system is more directly focused on quality than India’s.

China is a unique case in higher education development. In 2010 China achieved a Gross Enrollment Ratio of 30 per cent in higher education, up from an abysmally low 3–4 per cent in 1990. India barely improved its enrollment ratio in the same 20-year period, moving from less than 10 per cent up to 15 per cent enrollment. But these figures are somewhat misleading because they do not clearly show the effects of India’s population, which is younger than China’s. Fifty per cent of India’s population is under 25 years of age and thus has not yet entered the tertiary sector. This is reflected in UNESCO figures (Fig. 2 showing primary level enrollment in India and China 160 million and 100 million in 2010 respectively, and Fig. 4 showing tertiary level enrollment in India and China at 15 million and 30 million in 2010 respectively; and the projections do match with actual, barring primary enrollment in India, which is little less). Effectively, at primary school level enrollments, India has nearly 60 per cent higher enrollment than China, whereas in tertiary level enrollments, India has almost half of those of China.

The implications of a low gross enrollment ratio in tertiary level for a nation as young as India can be significant. The possibility of stalled economic growth is particularly worrying. Gross enrollment ratio for higher education in India is lowest among BRICS economies, and significantly lower than the world average.

The Twelfth Five-Year Plan (2012–17) of the statutory body responsible for governing higher education in India opens with: ‘Higher education in India is passing through a phase of unprecedented expansion, marked by an explosion in the volume of students, a substantial expansion in the number of institutions and a quantum jump in the level of public funding’. There is no mention of quality of education here, nor of the fact that this expansion is far outstripped by concurrent expansions in the Chinese higher education sector. This is odd considering that China is increasingly seen both as a key economic rival, and at best as a benchmark, for India.

Should India sacrifice the quality of its higher education to increase its quantity? Judging from the 2006 report of the National Knowledge Commission it appears that higher education is being geared towards producing a large number of graduates rather than high quality graduates. This report suggested that accountability indicators designed to ensure quantity were inhibiting the quality of graduates, particularly in relation to their creative and entrepreneurial skills. The report states that ‘the existing framework, rather than fostering accountability, constrains the supply of good-quality institutions whilst excessively regulating the existing institutions in the wrong places and is not conducive to innovation or creativity’. These findings are backed up by another report, which describes the Indian higher education sector as: ‘Over-regulated and under-governed’. At the same time, quantity expansion has also been grossly inadequate, making the challenges daunting on dual fronts of quantity and quality.

Quality was compromised in China’s massive expansion of higher education as well.  But today there are many more Chinese than Indian universities among the world’s top 200. Chinese secondary school students are exemplary performers in PISA tests while India fares poorly, coming 2nd last among 73 participating nations.

The salient reason for the discrepancy between Chinese and Indian educational performance is the absence of the state from higher education in India. During 2005-06 period, around 52 per cent of Indian students accessed higher education in private colleges, compared to less than 10 per cent in China. In China, government spends more than 1.5 per cent of its GDP on higher education while India spends less than 0.5 per cent. China has grown its higher education sector primarily with the help of universities, which number more than 2300. India has around 600 universities but they have more than 33,000 affiliated colleges. This is the largest number of affiliated colleges in the world, and is 10 times more than that of China. The majority of these universities and colleges in India are private and do not receive financial support from the Indian government.

The trend is even more disturbing. In 2000–01, enrollment in private unaided higher educational institutes was barely 33 per cent which became 52 per cent in 2005–6. The share of private unaided institutes among all higher educational institutes in India had been 33 per cent during 2000–01 period; in 2005–06, it increased to 63 per cent, and as per a recent report, it now stands at 80 per cent. These numbers show that the quantity expansion in India has been achieved by self-finance colleges alone. It effectively means almost all of Government support for higher education is for these 20 per cent of the minority students studying in Government colleges. It is not necessary that these 20 per cent of students, studying higher education in state-aided colleges, necessarily come from poorer backgrounds, or are more meritorious than the other 80 per cent pursuing higher education in self-financed colleges.

This structural anomaly is at the basis of the Indian economy’s lack of scale in production capacity. With so many colleges, monitoring and controlling becomes difficult, which can significantly compromise quality.

The fate of higher education in either country brings to mind China and India’s economic development path. Where China emphasised government-controlled reform and liberalisation, India opted for liberalisation with less government oversight. China continues to see unprecedented expansions in its economic capacity at a time when inadequate capacity remains a major economic bottle-neck for India.

Many scholars and commentators continue to draw comparisons between India and China. But it is increasingly clear that reforms in China and India are drastically different in character and impact. The higher education performance in either country speaks just as loudly as the overall economic picture.

Ranjit Goswami is Professor and Director of School of Management of RK University.

4 responses to “Economic growth and higher education in India and China”

    • The role of higher education in the growth and progress of a nation has been well recognised for centuries. Although the sector has been largely dominated by government institutions,intiative is to be taken by the government body to boost it.. The government must give more priority to education than to anything else…

  1. Hello, I am very immersed to read your blog. I am also very much appreciate the active education the forum provides.


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