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  • Yuvika Menon

National Education Policy, 2020

Education, often viewed as an investment in human capital, is an integral part of a country's economic growth and overall development. Often, these ‘investments’ aren't easily accessible to many, hence defeating the purpose of any previous education policies implemented in the country. In the case of India, the Right to Education Act of 2010 was the first major step taken in prioritising education and making it a fundamental right for all, regardless of their socio-economic standing. However, far before that in 1968, the National Education Policy (NEP) was introduced, and then further updated in 1986, and most recently amended in 2020. The latest update in the National Education Policy gained quite a bit of prominence and created a stir among the nation due to the significant changes outlined within the new policy.


Before the 2020 update, the NEP 1986 focused on the need to encourage the learning of traditional subjects along with the development of cognitive skills but ignored the need for vocational and practical skills. Similarly, the policy acknowledged the importance of better research infrastructure within the nation to advance its progress. However, no strict plan of action was ever made, and the lack of funding put towards this initiative reflected in its failure to achieve the goals set. Moreover, the NEP 1986 neither addressed the disparity between availability in rural and urban education nor discouraged the infamous practice of ‘ratta marna’ as most students recognise, also known as memorising textbooks and by-hearting subjects. The very idea that one specific definition with those specific words alone will give you the marks you require discourages students from expressing their creativity. It puts excessive pressure when it comes to the practice of exams, preventing them from enjoying the practice of learning and understanding the importance of critical thinking. On the other hand, the new NEP in 2020 has made several attempts to undo these practices by encouraging easy movement of students from colleges and continuous assessments throughout their learning period to reduce the pressures of final exams. The new NEP 2020 also fulfilled the goals outlined in 1986 for improved research infrastructures by establishing the National Research Foundation which funds and promotes research in all disciplines, all while creating a tangible link between R&D, academia, and industries within the country.


Moreover, NEP aims to provide universal access to education within the country itself by introducing foreign universities and allowing them to establish International Branch Campuses (IBCs), hence attempting to reduce the number of students leaving the country to pursue higher education. Along with this, the government has administered a common entrance test for all college applications, instead of region and stream-specific exams, which overall reduces costs that students would otherwise bear.


These changes are expected to bring a long-lasting positive impact on the future of higher education and its ability to retain students to continue studies within the nation itself, which in turn improves not only the reputation and financial well-being of a university, but also brings about collective economic and social benefits in the form of increased tax revenue, and higher salaries as well. Similarly, India would be able to reserve foreign exchange that would otherwise be provided for those who require education loans to study in universities abroad. NEP’s outline to introduce E-learning courses in multiple regional languages also promotes much-needed inclusivity in a country as diverse and vast as India. These changes also allow an increase in the workforce, which is both enhanced and skilled, along with higher enrolment rates, hence increasing job opportunities for professors in Indian universities.


The refinement of the new NEP brings about a lot of benefits for students and academic institutions alike since it allows more freedom for students and better policies for those working in the field of academia. The addition of skilled employees in the workforce opens avenues to those who were earlier unable to access such resources due to a socio-economic gap and will not only benefit the employment rate but consequentially increase the GDP rate.

As mentioned before, increased retention levels of students by higher education institutions allow them to hire more professors to accommodate for the expansion of the universities due to increased admission rates of students. As seen in Figure 1, the rightward shift from AD1 to AD2 increases the price level, here being the salaries, along with the total output from Y1 to Y2. The shift from Y1 to Y2 comes from the increase in demand for employees, which leads to higher productivity, and hence the rise in output. Therefore, the changes that NEP brings about present economic benefits as well, as it allows growth and increase in the total output, hence increasing the total real GDP of the country. Moreover, most youth from rural areas tend to work in the country's informal economy, which causes that output to be excluded from the final value determined to be real GDP. It also prevents the youth from receiving basic worker’s rights. It exempts the employers from the informal economy of regulations such as the minimum wage rate, as it is unsanctioned and doesn't operate under the jurisdiction of the government. The introduction of different schemes such as E-courses and lower cost-bearing through the imposition of a single common entrance test allows the government to start curbing the issue of youth in the informal economy, by providing them with opportunities that would benefit both them and the growth of India’s economy.


As said by Benjamin Franklin, “An investment in knowledge pays the best interest", and that is established in the effort put into making NEP 2020 a turning point for the education sector of the nation, along with its proactiveness in ensuring every sect of the population receives the same level of opportunities regardless of the level of privilege they hold. The multiple schemes introduced in the policy as discussed above and its implementation will bring about a multitude of positive changes for everyone involved, especially after the lack of change like education in India for over 3 decades. In conclusion, the new NEP policy was a good move to refine the education provisions of the country and improve inclusivity by reducing disparity within education, which in turn also benefits the economy due to the social benefits that accompany the policy.


About the Author

Yuvika Menon is a first-year BA. Hons. Economics student at the Jindal School of Government and Public Policy, who holds a deep interest in international relations, policymaking, and the influence of the political climate in the process of policymaking.


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