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Educating India’s poorest: A radical plan to attract private sector investment

Sreedharan, Ranjan (2009): Educating India’s poorest: A radical plan to attract private sector investment.

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Despite its recent economic successes, India still has a vast underclass where children either do not go to school or, if they did, they are forced to drop out early. In this brief paper, I outline a new model to attract private sector investment into the education of India’s poorest and most vulnerable children who, on present evidence, are unlikely to make their way out of the poverty trap anytime soon.

The idea is radical but at its core the plan is simple and may be summed up thus: “The private sector will be invited to set up schools and educational institutions for our poorest and most disadvantaged children in return for an incentive never tried out before. As and when these children grow up and start earning their livelihood, the income tax paid by them to the central government over their life-time would be passed on to the entity that nurtured and educated them.”

The financial viability of the model for Indian conditions was considered by Sankar Krishnan, a management consultant who was formerly a global partner with McKinsey and Company. His conclusions form an integral part of this paper.

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