Finance & Economy

Finance & Economy
Reliance to foray into education?
If reports/rumours are to be believed, RIL will be foraying into the education space .
According to an IDFC-SSKI report, Indians spend $50 billion annually on private education. The four segments of the education market — plus two, higher, vocational and supplemental — present a $80-billion opportunity by 2012. It is expected to grow at a CAGR of 16%, says a CLSA Pacific study.
Private equity and venture capital investors have made over 30 investments worth $300 million in the recent years, though, a fourth of these investments (in value terms) have gone to e-learning.
The existing rules restrict ownership of schools to trusts and no-profit bodies. While fees are not restricted, regulations come in the way of distribution of dividends or investment of surplus money in setting up schools.
The government is reportedly moving in the direction of deregulation of the sector.
An E&Y-Ficci report says India has a gross enrollment ratio (GER) of only 11% in higher education compared to about 60% in the US and Canada, and around 21% (average) in the BRIC countries. The higher education institutions (HEIs) in India can accommodate only 7-8% of the country’s college-age students.
Reforming the DGH (Directorate General of Hydrocarbons)
With the laying down of office by the present DGH Mr. VK Sibal amid some controversial circumstances, calls for sprucing up the DGH and redefining its role have made their appearance.
In 1993, when it was formed out of the resolution of the ministry of petroleum and natural gas, it was supposed to be the institution that is created as an 'independent regulatory body.' But remained far from independent and in fact its role was reduced to that of 'assisting the government' in both contractual and technical matters.
In 2001, the Naresh Narad Committee examined the need for setting up of an upstream hydrocarbon regulatory authority. Though, it recognised the need to distance regulation from government, it was not unanimous on DGH’s role. Later, the possibility of authorising common jurisdiction with the downstream regulator (Petroleum & Natural Gas Regulatory Board) was also discussed.
At present, there is no statutory upstream regulator. But DGH acts as one, de facto.
Historically, Dasgupta Committee (1991) envisaged reservoir management as the essential function of a regulator. Kaul Committee (1992) added leasing development conservation.
Government gives priority to educaitonal loans
Getting an education loan may become easier. The government plans to cushion public sector banks against any default on education loans, the primary reason why PSBs are often reluctant to give out such loans that does not have enough guarantee.
The government plans to protect education loans under a new credit guarantee scheme and has already asked the Indian Banks’ Association (IBA) to formulate a draft proposal, said a senior official with the finance ministry.
Due to a sharp increase in education loan offtake to Rs 32,460 crore, which is largely unsecured loan (without any collateral), senior officials of public sector banks have expressed apprehension that such a large loan component might impact the strength of the banks, particularly in case of default, as these loans are not backed by collateral.
The total outstanding education loans of public sector banks as on March 2009 were Rs 27,646 crore, a 39.51% increase from Rs 19,817 crore