How India's education system is failing economy

My column from last week on the "reverse brain drain" phenomenon, highlighting the recent trend of NRI's returning to India, seemed to hit a particular nerve among Indians and NRI's alike. The article produced strong opinions from all angles. On one end, NRI's that have not returned to India commented that although they would like to return to India, they could not due to family obligations and higher incomes. On the other hand, Indians lamented at the fact that NRI's left India in the first place. How dare they leave their beloved motherland to seek money in the West? I, for one, was not particularly surprised at the strong, emotional reactions, but was surprised that one key element was missing from the comments; the fact that the education system in the US is vastly different the one in India. Last week, I was helping a friend's son, who did his schooling up to higher secondary in Mumbai, in writing his college application essays for entrance into US universities for undergraduate studies. Now, for those that are unaware, undergraduate studies in the USA is quite costly. Some American universities cost upwards of $40,000 annually i.e. almost Rs. 25 lakh annually. So without a doubt, my friend had clearly thought this decision through. In his mind, sending his son to the US was totally worth the hefty price. But this brings about a troubling question that looms at large -- what exactly is it that differentiates the education system in the West from that of India? And, as a follow up, what is the net effect of the "brain drain" on India's economy? What if instead of a "reverse brain drain" India could stop the initial "brain drain" itself? If India was able to produce an educational system that was comparable to that of the West, students such as my friend's son would think twice before leaving the country. How would this change the picture? "Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime" Speaking from personal experience, having done my schooling exclusively in the West, the easiest way to differentiate the two systems of education is a skills acquiring approach (West) versus a knowledge acquiring approach (India). At the age of 16, I was introduced to the world of trading and investing through a simple investing competition that our teacher encouraged us to participate in. That simple competition, in return, got me interested in trading and drove me to be become better at it outside of school. The key element here is that the education system in the West fosters "out of the box thinking". For example, it strongly encourages entrepreneurship. Meanwhile, India has established IIT's, IIM's, law schools and other institutions of excellence; students here now routinely score 90 per cent marks. This makes it difficult for student even with 90+ percentage to get into the colleges of their choice. But the question here is -- what has really changed in the educational system? That being said, India's educational system has its advantages. It promotes mathematics and sciences, and it is not a coincidence that so many jobs are outsourced to India due to India's education system. Recently, the CEO of Google, Eric Schmidt announced that India's entrepreneurs have the "ability" to build the next Google if India "plays its cards right". But the fact still remains that students study mainly to score marks in exams, and sometimes to crack exams like IIT-JEE, AIIMS or CLAT. Meanwhile, in the West, teachers encourage their students to acquire skills. Investing for example there is a skill. If my teacher had not encouraged me to participate in that simple stock investing competition, my career might have taken a drastically different route. India needs to revisit the ways it promotes education. The education system in India is geared towards testing knowledge at every level as opposed to teaching skills. The "teaching a man how to fish" example perfectly illustrates this concept. If I teach a man how to fish, he will continue fishing even after I am long gone. But if I give him a fish to eat and leave, he will not have the skills required to learn how to capture fish in the future. This is not any different than the concept of education. In India, the best crammers for tests are rewarded. In the West ones who learn skills, and more importantly learn how to apply them are rewarded. Creativity, original thinking, research, and innovation are all cultivated and encouraged from a young age (and the age seems to get younger every year). All of this leads to one fact, that while students from the West rarely apply to Indian universities for undergraduate studies; Indian parents are willing to fork out 25 lakhs annually in order to get their sons and daughters into the Western education system. The economic impact of the brain drain That being said, what is the actual economic impact of the "brain drain" on India? If students did not leave, how would India benefit? The truth of the matter is that Indian students are rapidly escaping India. In the past decade alone, there has been a 256 per cent increase in the number of students studying abroad. The number now stands at 200,000 annually, and the students are going everywhere - Spain, Britain, Australia, USA, and even China. The staggering statistic is this one - Indian students studying abroad cost India $17 billion annually in lost revenue. If India was able to replicate the educational system of the US and was able to either prevent its students from leaving, or was able to attract students from other countries, $17 billion would be saved annually. This column is, no doubt, a generalization: Westerners lament at the fact that India and China routinely score higher on mathematics and science examinations and are actively looking to promote these two subject areas in order to better compete with India and China. But if India wants to prevent the "brain drain" from occurring and keep its brightest students within its borders, it must re-examine the ways it promotes its educational curriculum. Otherwise, it's just a matter of time before Mandarin is taught to Indians from a young age to prepare them to go to China for their studies. Raghu Kumar is the co-founder of RKSV, a broking company. The opinions expressed here are the personal opinions of the author.