A policy to regulate coaching centres

In May, a deadly fire at a coaching centre in Surat snuffed out 22 young lives. The rate of suicides in Kota, where many students converge to prepare for entrance exams, remains high. And yet, the coaching industry is rapidly growing. Data from the National Sample Survey Office’s 71st round reveal that more than a quarter of Indian students (a stupendous 7.1 crore) take private coaching. Around 12% of a family’s expenses go towards private coaching, across rich and poor families alike.

What purpose do coaching institutions serve in society? Do they enhance human capital? If they do, they serve the same purpose as schools and colleges. But if they don’t, then they are imposing a huge emotional cost to society. They crush creativity. In most cases, they only help a student to swiftly secure marks in some entrance exam, which is widely understood to be a sign of merit. This is a questionable connection. To signal merit, exams are only one criterion, and not necessarily the best one. So, coaching institutions exist to help people achieve only one idea of merit. This is a small benefit. They do not enhance human capital. Confining students in classrooms and making them study subjects they often hate destroys their natural talent. Hence, the social cost of these institutions outweighs their benefit by far. The industry needs a re-look.

Unregulated spaces

First, why must anything be regulated? Economic theories suggest that when markets fail, governments need to be brought in. Market failure may occur because of the presence of externalities or asymmetry in information. Governments are also important because they act to coordinate moral norms. On all these counts, coaching institutions emerge as the proverbial villains. Hidden behind legislations meant for tiny shops (Shops and Establishment Act) as ‘other’ business, they run an empire of evening incarcerations that arrest creative freedom. The big ones draw an entire generation of young minds and systematically erode their imagination. They ignite psychological disorders in students, undermine mainstream education, impose huge opportunity costs to students, charge an exorbitant fee which is often untaxed, and yet remain unaccountable (several court cases on breach of promise of refund are underway). This paints a picture of coaching centres as market bullies. The social costs are exacerbated by the absolute disregard for the well being of students, who are shoved into tiny rooms with little ventilation, let alone a fire exit. Society bears the burden — only for the sake of finding out who is marginally better than the other in cramming for some exam.


The building in Surat had an illegally constructed terrace. It had a wooden staircase that got burnt, thus disabling any possibility of escape. It had no fire safety equipment, nor any compliance or inspection certificate. The response of the State government was to shut down all coaching institutions in Gujarat until fire inspections were completed. This was a typical knee-jerk reaction.

The building which caught fire was located in a premise that was supposed to be a residential space, according to the approved plan of 2001. In 2007, a two-floor commercial complex was illegally built. It was legalised in 2013 under Gujarat’s regularisation laws. The other floors where the fire broke out were constructed illegally later. With such patterns of violating the laws, these inspections will only serve a tick-mark purpose. But here is the point. Although government measures are more emotional than rational, they have achieved the purpose of drawing our attention to coaching centres. In the last six months, three fire incidents have involved coaching institutions in Gujarat.

Valueless idea

Why do people start coaching institutions? Barring a few exceptions, coaching institutions sell a valueless but costly idea. Only those enterprises which have no value themselves play with the law. To blame the systemic flaws in the implementation of safety laws and to blame corruption in the government is to normalise the lack of integrity in the entrepreneur who decided to violate the law. To harp on lapses by the government is to turn a blind eye towards what kind of ethics we are drawing out of our enterprises, particularly those which purport to provide ‘education’. Coaching institutions, of course, are not necessarily ethical entities. Most of them do not add to the value of education.

While the reason for the growth of coaching institutions is the entrance exam culture of India, what is urgently required is a policy on regulating them. Some States have already passed laws to regulate the coaching industry — centres have to register with the government and meet certain basic criteria — for instance, they cannot employ teachers of government-recognised schools. Existing State laws, however, do not evince a consistent rationale that could aid in framing national regulations. There is also the Private Coaching Centres Regulatory Board Bill, 2016 in discussion. A PIL was recently filed in the Supreme Court on regulating coaching institutions. But we must recognise that a bad law is worse than no law. While the discourse being triggered is a welcome step, it is now important to ensure regulations that emerge are agile, forward-looking and empowering.


Yugank Goyal is an Associate Professor at OP Jindal Global University. He also sits on the Governing Council of the Indian School of Public Policy

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Printable version | May 7, 2021 2:39:44 AM |

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