Budget 2023: As Pandemic Wave Recedes, Indian Edtech Sector Seeks Tax Exemption

Budget Expectations 2023: The Covid-19 impact pushed the market size of Indian edtech sector, which was profitable during the Covid times, to $6 billion in 2022

A major learning from the post-Covid slowdown for edtechs was to maintain a steady focus on the product and courses in order to drive value for the students.

Source : Getty

The upcoming Union Budget will be a crucial one across industries, considering the Lok Sabha elections are slated for next year in 2024. For the B2C sector, a reduction in the GST will definitely enable the necessary push for the market to regain the footing lost in the last two years among multiple waves of Covid. Especially for edtech platforms and courses, a revision in the current tax slab will prove to be beneficial for students in order to reduce their overall cost of them. 

Present B2C Market Size Of The Sector

The Covid-19 impact pushed the market size of edtech in India to $6 billion in 2022. The sector is expected to touch a market size of $300 billion globally by 2029 as against $101 billion presently. (‘Indian Edtech in 2022' report by Blume Ventures)

Forecast For B2C Market Size In 2030

The government has set the tone for the current Budget as the one that will set the tone for the next 25 years. The government's emphasis on improving access to technology and education, particularly in underprivileged and rural regions, may result in greater collaborations with private businesses that are experts in offering technology-based education solutions.

The India@100 road map will bring a wave of digitisation across industries in India. There are a lot of incoming changes following the implementation of the National Education Policy. With the tax incentives and other incentives provided by the government, a lot of foreign institutes will plan to set up campuses in India, promoting India as an education hub.

Performance Of The Sector Post-Covid

The edtech sector was rather one of the most profitable sectors during the pandemic. There was an initial slowdown as the institutions started opening up, but with evolved consumer behaviour, this sector will continue to witness disruptions in the future. The evolved consumer behaviour post-Covid showcases a combination of online and offline learning, which is what a lot of the upcoming edtech start-ups are adopting. A major learning from the post-Covid slowdown for edtechs was to maintain a steady focus on the product and courses in order to drive value for the students.

Impact Due To Inflation, Recession, Or Geopolitical Conflicts 

The current geopolitical situation is increasingly affecting the global economy, toppling the global GDP. The inflation has been the same for the education sector as it has been across industries, preventing students from securing a foreign education which used to be more economical pre-covid. Digital education has brought a ray of hope for students looking to pursue courses from reputed global institutions. The long-term impact is yet to be decided for this industry. Like all other nations, India must continue to push for growth while operating within the restrictions and possibilities that the global economy presents. 

Expectations From Budget 2023

Harkunwar Singh, co-founder and CEO, OneistoX, said, "As an ed-tech platform invested in bridging the innovation gap in the architecture, engineering, and construction (AEC) industry, we are hoping to see tax exemptions on e-learning products and services in this year's Union Budget. Construction is the least digitalised industry in India today after agriculture."

"The lack of technology adoption in this sector can only be bridged with an upskilled workforce that has access to more convenient mediums of digital learning. At this time, e-learning is taxed at a whopping 18 per cent. Tax exemptions could therefore reduce financial burdens and encourage more young professionals to upskill and contribute greatly to the innovation and digitalisation of the construction industry," Harkunwar Singh added.

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