You are on page 1of 56

The Nataraja Foundation

www.nataraja.org.in The Indian Primary & Secondary


Education Megaproject

27 th March ' 2010

This Excel workbook deals mainly with the


financial structures, cost estimates and
detailed financials of the Education
Megaproject.

Project Concepts and Objectives The actual project, the thinking behind it, it's
design criteria etc have been covered in detail in
the project concept document which is available
for free download from the Nataraja Foundation's
The Indian Primary & Secondary Education Megaproject website www.nataraja.org.in

Over the last 30 years India has spent very little money on building new schools . The focus has instead been on getting quick
results through projects that involved the least possible expenditure. So few new schools were built even though India's
population grew from from approx. 846 million in 1991 to almost 1.15 Billion people in 2009. In the schools that were built,
the quality of infrastructure is very poor. Planning commission data clearly shows that 44 % of schools at the primary level do
not have toilets for instance and 15 % do not have drinking water . Planning Commission data also reveals that nearly 45 % of Creating a lifestyle around the teaching
the SC / ST children drop out of school by class V and by class XIII in excess of 60 % drop out of school. Various studies profession
conducted by government of India as well as foreign agencies are showing that the percentage ( % ) of " Out Of School
Children " is falling but no one is talking about the third rate quality of the schools that the children are being enrolled in and Low cost yet very elegant housing for
the abysymal working conditions of the teachers who teach there. teachers under the programme.

As a result of all this, in 6 - 8 years time , over 100 Million children will exit the school going age group without any This particular house was built at a cost of
employable skills. This is going to create huge social problems in the country. Rs 750 / Sq Ft in 2007 in the Vernacular
Architectural Style.
Obviously something has gone terribly wrong with our entire approach to education and we need a robust strategy to solve
the problems in our education system. Location : Bangalore
Architect : RL Kumar
Therefore ...

Central to the thinking behind this project is the belief that the main reason for the steep decline in the quality of human www.vernarch.com
resources in India has been the neglect of the teaching profession and teachers over the last several decades.

In India today a crane operator with 5 years of experience makes more money than an MA in Economics or a MSC in
Maths or a teacher with a proper BEd degree and with 10 years of teaching experience at the primary school level. This
has warped the economic choices that a fresh graduate makes and has resulted in the least qualified individuals
handling the most important of all the jobs in this country (The teaching of our children and tomorrows citizens ).

This project takes note of the fact that India reached the height of its glory when the teacher was at the head of our society
and therefore seeks to bring back this long lost Indian tradition through an innovative mechanism on a truly massive
scale. The project is focused on providing a sound basic education as it is more important to have a sound education at the
primary and secondary levels for a majority of our people than to spend billions of dollars on higher education and have most
of those people going abroad.

The whole project therefore is designed around the primary & secondary school teacher ( Project is not centered on the
student ) with a view to creating a simple yet elegant lifestyle around the teaching profession so as to attract the
best minds towards a career in teaching and thereby correcting a macro imbalance in our society. While doing this , the project
also reaches more under privileged children than any other past or currently planned programme of the Govt. Of India.

This Excel workbook concentrates on the financials of the project. For a detailed understanding of the various
issues, readers are requested to go through the Project concept document which describes the project is proper
detail.

Project Scale :

The project seeks to build a total of 30,000 New schools (with 600 students per school ) under the Public Private
Partnership ( PPP ) format during the period 2012 - 2023. Each school under the programme will share teaching
resources ( Teachers , Teaching aids etc ) with 14 other village schools in it's surrounding area so that a total of 420,000
additional schools are covered under the programme .

The main problem then is money and since the government does not have adequate conventional resources , Innovative
financing mechanisms needed to be found to finance this large education project. The project has therefore focused on
bringing in innovative ideas on the finance side and we have been able to find innovative ways to raise approximately US $
131.38 Billion as one time Capital expenditure to build the schools and US $ 42.57 Billion as yearly operational expenditure
to run the 30,000 new school system as well as it's huge teacher sharing programme that will reach an additional 108 Million
children in 420,000 assisted schools. As a result , once fully commissioned in 2023, a total of upto 126 Million children will
receive high quality education totally free of cost .
bringing in innovative ideas on the finance side and we have been able to find innovative ways to raise approximately US $
131.38 Billion as one time Capital expenditure to build the schools and US $ 42.57 Billion as yearly operational expenditure
to run the 30,000 new school system as well as it's huge teacher sharing programme that will reach an additional 108 Million
children in 420,000 assisted schools. As a result , once fully commissioned in 2023, a total of upto 126 Million children will
receive high quality education totally free of cost .

Phase Number of Hub Schools Number Of Assisted Schools Commissioning Schedule


( Teacher Sharing Programme )

Bootstrap I - - Q1- Q4 2011 250 New Teacher Training


Institutes to train 300 teachers
Phase II each per year + 60 New Centers of
Bootstrap II - - Q1- Q4 2012 Repeat Phase I Vernacular Archiecture to train 300
Master Masons Each every year

Phase I 6000 Hub Schools 84,000 2012 – 2014

Phase II 9000 Hub Schools 220,000 2015 – 2017

Phase III 15000 Hub Schools 420,000 2018 – 2023

Phase IV Possible repeat of total project ( another 30,000 schools ) 2023 – 2029
to cover 4,20,000 additional schools
_____________________________________________________________________________________ Project Schedule To be Extremely
Aggressive
30,000 New Schools to be commissioned by 2023
_____________________________________________________________________________________
Notes :

1. Each Of Bootstrapping stages I & II will consist of 250 Teacher Training Institutes to train 300 teachers
each per year + 60 Centers of Vernacular Archiecture to train 300 Master Masons each year. Bootstrap II
will be a repeat of Bootstrap I

2. It is not possible to execute Phase I of this project faster as India currently does not have enough
trained teachers who possess the necessary capability / sensitivity to train young minds. This problem
will be overcome by 2016 after which project execution velocity will pick up.

3. Phase IV could essentially be a repeat order which will repeat phases I, II and III in half the time. It will
be possible to dramatically crash commissioning schedules due to retained learning within the
project enterprise.

4. Each day school will operate in two shifts to maximize coverage while keeping costs low.

Economic & Environmental Impacts of the Project :

The following are the main economic and environmental features of the project
which seeks to use Traditional yet very elegant Indian Architecture
( where building life is over 100 years ) without any significant maintenance :

1. This will be the worlds largest , multi-location environmental project as


it will use 80 % traditional earth based material and very little cement
and steel in the construction of the 30,000 schools. The C02 / Green
house gas addition by this project will therefore be virtually zero. It will
thus allow huge development without adverse environmental impacts.

2. Project will in addition lead to the planting of around 150 Million trees
all over India between 2012 and 2023.

3. While the project will lead to a direct expenditure of US $ 131.38 Billion


Billion over the period ( 2012 - 2023 ) on the creation of the low
cost , yet extremely elegant school campuses, It will provide
huge additional employment opportunities to millions of Indians . The
total money multiplier effect on the economy will be in the range of
3 ( conservative ) to yield a total GDP Net delta addition of US $ 300
Billion from the construction of this project alone. The high quality
Human Resourses that will be created by building schools
designed around the teaching profession will be additional.
3 ( conservative ) to yield a total GDP Net delta addition of US $ 300
Billion from the construction of this project alone. The high quality
Human Resourses that will be created by building schools
designed around the teaching profession will be additional.

Prepared By
Ashish Puntambekar
Project Designer , The Nataraja Foundation
(00-91-9867612368)
ashish.puntambekar@gmail.com

Analyst Note :

This model is provided for the information of Educationists, Indian Government Officials , Corporates , Financial
Institutions and NGO's and must be seen in conjunction with the project / business spreadsheets prepared for both
the stand alone day schools and residential schools as well as the optimised chain that comprimises the
megaproject.

The Project has been designed based on Information published by the Indian Planning Comission ( XIth Plan
documents ) as well as other published material on the National Knowledge Commission / Ministry of HRD
websites. Published papers by experts on the Indian Education System have also been studied and means to
overcome the shortcomings pointed out by the experts have been incorporated in the project design.

While these agencies have not been a party to the conception of this project plan, the author would like to thank his
sources for making this plan possible through their data.
Project Design Basis / Education Philosophy
The Nataraja Foundation
www.nataraja.org.in

" Let the watchword be acceptance and not exclusion "

Sufi Saint Kabir A project of this size and scale will be a dead and soul-less agglomeration of Guru Nanak Dev
buildings and computer networks without a sound philosophy which is timeless
and yet extremely advanced and which seeks, as it were , to bind people of
diverse faiths and lead them towards the realization of their potential as human
beings .

The following words of Vivekananda will therefore serve as a Pole Star for future
Indian thinkers on education “ Let the watchword be acceptance and not
exclusion. Not only toleration , for so called toleration is blasphemy. Toleration
means that I think you are wrong and I am just allowing you to live. Is it not
Mother Teresa
blasphemy to think that you and I are allowing others to live ? I accept all
religions that were in the past and worship them all. I worship God with everyone
of them, in whatever form they worship him”. Rabindranath Tagore & Gandhiji

Vivekanand Continues …

“ I shall go to the mosque of the Mohammedan ; I shall enter the Christian’s


church and kneel before the crucifix. I shall enter the Buddhist temple where I
shall take refuge in Buddha and in his law. I shall go into the forest and sit down
in meditation with the Hindu, who is trying to see the light which enlightens the
heart of everyone.
Dr. APJ Abdul Kalam in Class
Not only shall I do all these things but I shall keep my heart open for all that may
come in the future . Is Gods book finished ? Or is it still a continuous revelation
going on. It is a marvelous book – these spiritual revelations of the world . The
Bible , The Vedas , The Koran and all other sacred books are but so many
pages and an infinite number of pages remain to be unfolded ”.

The Importance Of The Teacher In The Indian Tradition


Please Click Here To Access The Full
Copy of the Project Design Basis /
Gurur Brahma, Project Philosophy Document
Gurur Vishnu,
Gurur Devo Mahesh Varah.
Guru Shakshat Para Brahma,
Tasmai Shri Guruve Namah.

The teacher is Lord Brahma as he generates knowledge within us. He is like Lord
Vishnu as he sustains us and guides us on the right path. He is like Lord
Mahesha (Shiva) as he destroys ignorance and thereby enlightens us. My
Salutation to such a Guru, who is verily the Supreme God.

Note : The Project Design Basis / Education Philosophy can also be downloaded
from the following website :

www.nataraja.org.in
EDUCATION MEGAPROJECT - OVERALL CAPEX / OPEX SNAPSHOT OF PPP SCHEME
Cash Requirements Summary
Bootstrap 1 Bootstrap 2
US $ / Rs Exchange Rate ( 18th march ' 2010 ) 45.49 Phase I Phase II Phase III

Item 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Teachers Training Institutes ( Lot @ Rs 8 Crores Capex & 250 250


Rs 4 Crores Opex for each per year )

Pilot Projects ( Schools in 28 States + 7 Union Territories) … Assumed that 100 35 35 Assumed that In Actual Project
85 % day schools and 15 % Residential Schools % of Pilot Cost Construction 60 % Cost is borne
borne in the same in the 1st year and 40 % in the
year second year
Masons Training Institutes ( Lot & Rs 5 Crore Capex and Rs 60 60 The Nataraja Foundation
2 Crore Opex for each / year ) www.nataraja.org.in

Day Schools Nos Of 850 2125 2125 2550 2550 2550 3187 3187 3187 3187
Commissioning Sequence ( For Initiating Opex ) Institutions 850 2125 2125 2550 2550 2550 3187 3187 3187 3189
Cumulative commissioned 850 2975 5100 7650 10200 12750 15937 19124 22311 25500

Residential Schools 150 375 375 450 450 450 563 563 563 563
Commissioning Sequence ( For Initiating Opex ) 150 375 375 450 450 450 563 563 563 561
Cumulative commissioned 150 525 900 1350 1800 2250 2813 3376 3939 4500

Total Schools Construction Started Each Year 1000 2500 2500 3000 3000 3000 3750 3750 3750 3750
Commissioning Sequence ( For Initiating Opex ) 1000 2500 2500 3000 3000 3000 3750 3750 3750 3750
Cumulative commissioned 1000 3500 6000 9000 12000 15000 18750 22500 26250 30000

Costs Of Teacher Sharing Programme

Costs Of Teachers Guest houses ( A total of 4,20,000 14000 35000 35000 42000 42000 42000 52500 52500 52500 52500
Guesthouses will be built under the teacher sharing
programme )
Fuel Costs Of teacher sharing programme : Rs 11.56 115.6 404.6 693.6 1040.4 1387.2 1734 2167.5 2601 3034.5 3468 3468
Lakhs / School / Year to cover 14 assisted schools 0.12 Opex To Be added

IT System for Existing Schools … ( % Complete ) 20% 40% 40% Capex & Opex to be be added depending on system
Total Cost Of System with alerts @ Rs 500 Crores : 500 100 200 200 needs and the extent to which the teacher sharing
programme is implemented.
Taken as US $ 5 Billion
IT System for Megaproject Schools … ( % Complete ) over 10 years ( IT Infra )
( Launching of 12 Satellites + Using 4,00,000 Km of Existing 0 0 0 758 1895 1895 2275 2275 2275 2843 2843 2843 2843 0
Fibre Optic Across 30,000 Hub School and 420,000 Assisted Costs of
Schools Via VSATS ) Essential Items
in Crores
% Completion 30% 70% 100%
Forming and Staffing Of the ISIC with Average Salary @ Rs 450 135 315 450 450 450 450 450 450 450 450 450 450 450 450
20 Lakh / Year = Rs 450 Crores ( Fully Staffed as below )
( 50 Senior Educationists , 300 Finance Professionals, 1200
Project Engineers, 300 IT Professionals, 100 Lawyers, 300
Architects )

Opex Cost of Teacher Training Institutes 1000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000
Opex Costs of Masons Training Institutes 120 240 240 240 240 240 240 240 240 240 240 240 240 240
Development Of Vernacular Languages + Urdu+ Hindi + Sanskrit 933 2333 2333 2800 2800 2800 3500 3500 3500 3500

Capital Expenditure Rs.( Thousands Of Crores ) #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!
( US $ Billion ) #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!
Total Capital Expenditure ( Rs Crores ) #VALUE!
Total Capital Expenditure ( US $ Billion ) #VALUE!

Operational Expenditure ( Rs. Crores ) #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!
( US $ Billion ) #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!

Sanskrit is possibly the worlds oldest language and it is dying in India. The Education Megaproject therefore allocates Rs 8000 Crores over 10 years to the promotion of Sanskrit in schools and for the digitizing of Sanskrit content as Sanskrit serves as
the basis for several Indian and even international languages. This will reverse the huge neglect it has suffered neglect over the last 100 years . All other Indian Languages ( Tamil, Bengali, Marathi, Telugu, Gujarati, Kannada etc. ) including most
importantly Urdu and Hindi together will receive an additional Rs 20,000 Crores over 10 years under the Megaproject for the development of digital content and opening of Institutions for scholars. Total Rs 28,000 Crores. Encouragement of local
languages will allow the poorest citizen to participate fully in the economy. We want every farmer and labourer to have an equal opportunity and language should not be allowed to be a barrier due to lack of Funds. The Education Megaproject has a
special large budget for Vernacular Language propogation.
the basis for several Indian and even international languages. This will reverse the huge neglect it has suffered neglect over the last 100 years . All other Indian Languages ( Tamil, Bengali, Marathi, Telugu, Gujarati, Kannada etc. ) including most
importantly Urdu and Hindi together will receive an additional Rs 20,000 Crores over 10 years under the Megaproject for the development of digital content and opening of Institutions for scholars. Total Rs 28,000 Crores. Encouragement of local
languages will allow the poorest citizen to participate fully in the economy. We want every farmer and labourer to have an equal opportunity and language should not be allowed to be a barrier due to lack of Funds. The Education Megaproject has a
special large budget for Vernacular Language propogation.
2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040

3468 3468 3468 3468 3468 3468 3468 3468 3468 3468 3468 3468 3468 3468 3468 3468

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

450 450 450 450 450 450 450 450 450 450 450 450 450 450 450 450

2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000
240 240 240 240 240 240 240 240 240 240 240 240 240 240 240 240

#VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!
#VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!
TERM SHEET

Assumptions On Financing / Sources Of Funds :


The Nataraja Foundation
US $ / Rs Exchange Rate ( 18th march 2010 ) 45.49 www.nataraja.org.in

Sl. No. Source Description Estimate of Total Notional Amount % Of Source Amount Available Cash Available Each
Possible Corpus Potentially Available / Proposed For Each Year Year (
( US $ Billion ) Year ( Education ( US $ Million ) Thousands of Crores )
US $ Billion ) Megaproject

YEARLY FUND FLOWS / Annuities

1 Net Present Value Of Inceremental GDP 500 20 10% 2000 9098


Increase after GST implementation starting 1st
April ' 2010 ( Delta Over Current ) . The Total
Corpus in the next column is assumed and
calculated over a 25 year period with a discount
rate at 3 %. This cash flow will triple by 2025
when the size of the Indian economy is expected
to be US $ 4.5 Trillion.

2 30 % of a proposed new tax on the services 510 5.1 30% 1530 6959.97
component in future Infrastructure projects.
The base case estimate of the delta / net
additional Infrastructure investment in India over
the next 10 years is taken at US $ 1.7 Trillion
( Goldman sachs View ). This cash stream
will triple by 2025 when the size of the Indian
economy is expected to be US $ 4.5 Trillion.

3 Graduate Tax Collected From Employers In 10.11 2.53 80% 2022.42 9200
India. It is assumed here that there are 46
Million Graduates in India ( 2004 Estimate ). This
number today is larger. This cash stream will
double by 2025 when the size of the Indian
economy is expected to be US $ 4.5 Trillion.
Assumptions On Financing / Sources Of Funds :

US $ / Rs Exchange Rate ( 18th march 2010 ) 45.49

Sl. No. Source Description Estimate of Total Notional Amount % Of Source Amount Available Amount Available Each
Possible Corpus Potentially Available / Proposed For Each Year Year (
( US $ Billion ) Year ( Education ( US $ Million ) Thousands of Crores )
US $ Billion ) Megaproject
4 Quantized Tobin Tax on Forex Transactions. It 1.1 1.1 100% 1095 4981.16
has been assumed that the volume of daily
average forex transactions in India and by
companies doing business in India is of the order
of US $ 15 Billion. A Tobin Tax ( First
proposed by Nobel laureate James Tobin ) to be
levied at the rate of 0.02 % on the total volume of
the transaction which will be quantized as per the
size of the transaction with higher rates applying
to larger transactions to prevent speculation on
the Indian Rupee as it moves towards Capital
Account Convertability ). This cash stream will
triple by 2025 when the size of the Indian
economy is expected to be US $ 4.5 Trillion.

5 Yearly Rent From Re-developed PSU Land by 3.00 3.00 100% 3000 13647
the Indian Social Infrastructure Corporation
( ISIC ) Under The Urban Equity Withdrawl
Programme ( Phase I ) .

6 Yearly Rent From Redeveloped PSU Land by 10.00 10.00 100% 10000 45490
the Indian Social Infrastructure Corporation
( ISIC ) Under The Urban Equity Withdrawl
Programme ( Phase II ) .
Assumptions On Financing / Sources Of Funds :
US $ / Rs Exchange Rate ( 18th march 2010 ) 45.49

Sl. No. Source Description Estimate of Total Notional Amount % Of Source Amount Available Amount Available Each
Possible Corpus Potentially Available / Proposed For Each Year Year (
( US $ Billion ) Year ( Education ( US $ Million ) Thousands of Crores )
US $ Billion ) Megaproject

7 Teacher / Content Outsourcing Business : The 21.04 10.52 40% 4207.52 19140
Education Megaproject will be employing
approximately 1.74 Million Teachers across
India on 5 year Rolling Contracts. It is proposed
that the terms of the contracts be flexible enough
to permit teachers to organize themselves into
teams which could then, in an organized
manner , produce education content for the world
market. The revenue earned through this venture
will be shared by teachers and the ISIC in the
ratio 60:40 with the larger sum going to the
participating teachers. They will also participate
under the Aegis of the ISIC in a Teacher
Exchange Programme with schools in foreign
countries. For the purposes of this calculation the
total teacher strength is assumed as 1.5 Million. It
is further assumed that just 50 % of the teachers
will participate in this venture and that each
teacher's extra earning potential is Rs 5,50,000
each year.

8 Students on Fractional Vouchers / NRI Quota #VALUE! #VALUE! 100% #VALUE! #VALUE!
and SAARC / Foreign Students : A majority of
the students within the Megaproject will be on
Education Vouchers ( 60 - 70 % ). However some
37 % + of the students from middle class families
and well off families will be on fractional
vouchers with 2 / 3rd subsidy and an additional
2 - 3 % could be from SAARC countries or NRI /
Foreign Students who will pay a premium
( Double The Voucher value ).

ONE TIME FUND FLOWS - DIRECT FINANCE FOR CONSTRUCTION

9 Coordinated Equity Withdrawl By the ISIC on 40 40 100 40000 181960.00


PSU Owned Land in Metros and Large Cities

10 Un-Utilized Funds with various Ministries and 21.59 21.59 100 21590 98212.91
NGO's

11 Equity Infusion By Promoter groups for 25,500 #VALUE! #VALUE! 100 #VALUE! #VALUE!
Day Schools and 4500 Residential Schools

12 Committed and Un-Utilized Funds Lying with the 15.6 15.6 100 15600 70964.40
World bank and the Asian Development Bank, on
which the government of India is paying
Commitment Charges of over Rs 125 Crores
each year.
Assumptions On Financing / Sources Of Funds : `

US $ / Rs Exchange Rate ( 18th march 2010 ) 45.49

Sl. No. Source Description Estimate of Total Notional Amount % Of Source Amount Available Amount Available Each
Possible Corpus Potentially Available / Proposed For Each Year Year (
( US $ Billion ) Year ( Education ( US $ Million ) Thousands of Crores )
US $ Billion ) Megaproject

OTHER POTENTIAL SOURCES OF FINANCE

13 278 2.78 1% 2780 12646.22


In early March ' 2010 , India's Foreign Exchange
Reserves stood at US $ 278 Billion. This is a
huge sum and it has earlier been suggested by
several others that a small part of the RBI's
reserves should be used to finance Infrastructure
projects in India. Schools represent essential
social Infrastructure and the Education
megaproject could draw on some of this
resource.

14 30 3 10% 3000 13647.00


Dis-investment in Indian Public Sector Entities
and Banks. This represents a huge potential
scorce of funds . However successive
governments have been using dis-investment
proceeds to help bridge the huge fiscal deficits
that the government of India runs. In fact this
money is best used to finance productive capital
expenditure as in education projects that greatly
enhance the country's GDP.

If US $ 1.7 Trillion is to be invested in


Infrastructure over the next 10 years, the first
sector that will expand exponentially is
banking. Government of India will do well to dis-
invest it's stake in a few large banks to raise
additional resources while at the same time
allowing a greater private sector role in the
banking industry , with strict controls in place of
course.
Pg 1 0f 4

Remarks / Critical Assumptions

If net / delta addition to GDP is US $ 20 Billion each year


solely due to GST implementation, then government can
afford to earmark 10 % of that Delta to an Education Mega
Project from the Consolidated Fund Of India through a special
legislation that creates " The Education Megaproject Fund ". It
is being assumed here that the NCAER has taken a 25 year
period for calculating the Net Present value at a 3 % discount
rate. If they have taken a 15 year period instead , then the
yearly sums that will be available will be much larger.

A new tax proposal on the lines of the recently implemented


tax on the services component of housing projects ( 2010
Budget ) will need to be implemented to extend service tax to
the labour and services component of Infrastructure projects.
This will very easily generate a new cash source for creating
the human resources necessary to plan and build large
Infrastructure in India. Right now there is a shortage of 30
million trained people in the construction Industry alone
( Mckinsey 2008 ). So the imposition of a service tax on the
labour / skill component of Infrastructure projects is fully
justified . It is being assumed here that 30 % of an
Infrastructure Projects cost is services and Labour. It is also
being assumed that servoce tax on the Labour and services
component will be @ 10 %.

Employers are being taxed because they are getting access to


qualified graduates free of cost and have not paid a single
paise for their education. This tax will be levied at the rate of 3
% on the Cost to Company ( CTC ) of the employee and will
be paid not by the employee but the employer. Please note
that the current education cess and professional taxes are
separate taxes and are being borne by the employee.
Companies must also pay a tax because they are getting
trained manpower free of cost. We believe that companies will
not be able to pass this tax on to employees as companies will
also be competing with each others in a rapidly growing
economy where skills shortages are acute. Also it has been
realistically assumed that only 25 % of this tax is collectable
from graduates as many work in the un-organized sector.
Many housewifes are graduates too . If independent
professionals such as doctors can be taxed, the collection will
go up dramatically. Also it is assumed that 80 % of this tax will
go for primary education as a person spends 80 % of his time
in school.
Pg 2 Of 4

Remarks / Critical Assumptions

Given that India is going to be the largest growing market in


the world over the next few years we do not expect business
to move away from India due to the imporition of this tax. The
Imposition of this tax has been considered in the latest
meeting of the G 20 nations in 2009 and It has also been
supported for implementation by none other than our own RBI
governor Dr. D SubbaRao in Dec ' 2009. Since 90 % of the
worlds forex transactions are cleared in just a few financial
centres globally , it will not be difficult to impose this tax which
can provide much needed funds to Education and Healthcare
projects in Rural India.

Subsequent to the sale of 3000 Acres out of a total of 30,000


Acres of prime real estate in Indian Cities, The ISIC will
publish a Global Tender Inviting leading Urban Developers
from around the world to come to India to develop Large Real
Estate Projects. 27,000 Acres of Urban, Government owned
land will be put out on bids under a Public Private Partnership.
Indian companies will participate in the bidding rounds and will
compete with foreign companies. The bids will require project
developers to pay an upfront annuity / yearly instalment of US
$ 3 Billion for the 27,000 acres taken together over the first 10
years and submit plans for the development of Financial
centres where the ISIC will be the owner of 50 % in each
project. Developers will need to come up with ideas whereby
the net earnings to the ISIC will be of the order of US $ 10
Billion each year from the 27,000 Acres of prime real estate
starting from the 7th year after the Bidding. This effective
Urban Equity Withdrawl plan will provide funds for rural
development.

Phase II cashflows will begin to accrue from year 7 onwards


as the PPP projects in Urban Development begin yielding a
return of US $ 10 Billion to the ISIC as explained under V
above.
Pg 3 Of 4

Remarks / Critical Assumptions

It is being assumed that revenues from the Teaching Content


Development Business and the Overseas Teacher
Exchange Programme will be shared by Teachers / ISIC in
the ratio 60 :40, with 60 % of the revenues going to the
teachers. We have therefore included only the balance 40 %
of revenues as ISIC Income. Further , we do not believe that
this activity will disturb teaching activity in the country as
teachers have considerable amounts of free time and because
the schools have been overstaffed by design not just for
sharing teachers with 420,000 existing and deprived schools
but also with this kind of revenue opportunity clearly in mind.

Fees for Children will be quite affordable to parents as they


well be charged at 1/ 3rd of the value of the voucher. In the
case of Day schools fees will be in the range of Rs 25000 /
child and in the case of fully residential schools, fees will be in
the range of Rs 65,000 - Rs 75,000 which we believe are very
affordable for the Middle Class and above.

The procedure for this is explained in great detail in the project


concept document under construction phase financing.

This financing option has emerged through a study of the


Comptroller & Auditor General's report ( CAG Report ) for
2007 - 08. A special audit committee will be constituted to
trace and recover this money for the Education Megaproject.
This money will come from the Promoters of 30,000 Schools
over a 10 year period ( 2012 - 2022 )

This financing option has emerged through a study of the


Comptroller & Auditor General's report ( CAG Report ) for
2007 - 08. Usually World Bank / ADB Loans are available for
specific projects and cannot usually be re-assigned , We
believe it will be possible to lift the entire corpus for this single
Education Megaproject as the project subsumes within itself
areas as diverse as Women and Child health and education to
rural sanitation and rural roads etc.
Pg 4 Of 4

Remarks / Critical Assumptions

The Education Megaproject has not included Foreign


Exchange Reserves in its sources in the current Rev 03 of the
project. This represents a potential future source of finance.

The Education Megaproject has not included Dis-investment


proceeds in its sources in the current Rev 03 of the project.
This therefore represents a potential future source of finance.
The Indian Primary & Secondary Education Mega
Project
The Nataraja Foundation
Project Legal & Financial Structure
www.nataraja.org.in
Government Of India

Ministry Of HRD Ministry Of Finance


CONSTRUCTION
PHASE ( 2012 – 2023 ) Parliament
Ministry Of
Disinvestment
( FUTURE SOURCE )
Consolidated Fund Of India
Size Of The Indian Economy
US $ 1.3 Trillion ( 2010 )

Exchange Rate ( 18th Mar ‘ 2010 ) : Financing Concept is similar to the


1 US $ = Rs 45.49 Golden Quadrangle / Highways
Financing.

8 different sources of funds are


routed to a special " Education
Megaproject Fund " … A special
Act of Parliament will enable this.
INDIA BASED SOURCES OF FUNDS

1. Yearly Fund Flows


Sovereign
10 % of New Goods & Services Tax ( GST ) US $ 2.0 Billion / Year Guarantee
Receivables = US $ 2.0 Billion / Year

INDIAN & INTERNATIONAL


30 % of Proposed New Tax on Service BANKS
US $ 1.53 Billion / Year
Component of Infrastructure Projects
= US $ 1.53 Billion / Year

Collected From Employers of Graduates US $ 2.02 Billion / Year Securitize 10 year annual
Graduate Tax = US $ 2.02 Billion / Year r ae Y/ noilli B 46. 6 $ S U Receivables at 6 %

r ae Y/ noilli B 46. 6 $ S U
and Draw US $ 49 Billion

Quantized Tobin Tax on US $ 1.09 Billion / Year


Forex Transactions = US $ 1 .09 Billion/Year
2. One Time Fund Flows

US $ 3 Billion
Education Megaproject
PSU Owned Metro / Large City Real Estate US $ 49 Billion For Capex
Fund Act
Equity Withdrawl = US $ 40 Billion
Education Megaproject Fund

Unutilized Funds ( US $ 21.59 Billion ) With


Various Govt. Ministries and NGO’s US $ 67.15 Billion for Capex
as per GAG Report 2007 -08 + US $ 3 Billion Annual Rent
US $ 67.15 Billion Special Act Of Parliament to give
Legal status to SPV and enable
Sale Of Navratnas, PSU's , Banks = US $ 0.00 Future standby source
Fast Track Execution based on
US $ 0.00 Billion
US $ 15.6 Billion Initial Sovereign Guarantees
US $ 5.56 Billion For Capex
30,000 Private School Operators ( Equity Infusion )

Indian Social Infrastructure ( ISIC Act )


Corporation ( ISIC )
US $ 15.6 Billion Sovereign Guarantee
Low cost Loans for Capex to Of Committed But
For School Capex Loans
School Concessionaires. This Un-Utilized
is in addition to the US $ 15.6 Funds
Billion that is paid as a bullet
payment to the ISIC
World ADB
Bank

Capacity To Raise / Spend US $ 134.75 Billion OR Rs 612,977 Crores

Project Construction Cost = 131.38 Billion


( 30,000 Hub Schools + Infrastructure for Teachers Sharing Programme )

Financial plan therefore raises sufficient funds for construction


The Indian Primary & Secondary Education Mega
Project
Project Legal & Financial Structure
The Nataraja Foundation
www.nataraja.org.in Government Of India

Ministry Of HRD Ministry Of Finance


BOT OPERATIONS
PHASE Parliament
Ministry Of
Disinvestment
( FUTURE SOURCE )
Consolidated Fund Of India
Size Of The Indian Economy
US $ 4.5 Trillion ( 2025 )

Exchange Rate ( 18th Mar ‘ 2010 ) :


1 US $ = Rs 45.49

Key Point to note is the size of the


INDIA BASED SOURCES OF FUNDS Indian Economy in 2025

1. Yearly Fund Flows

10 % of New General Service Tax Based US $ 6.0 Billion / Year


Students on Fractional
GST Receivables = US $ 6.00 Billion / Year
Vouchers
and NRI / SAARC Quota
30 % of Proposed New Tax on Service US $ 4.59 Billion / Year
Component of Infrastructure Projects
= US $ 4.59 Billion / Year Teacher

r ae Y
Outsourcing
Business
Graduate Tax = US $ 4.0 Billion / Year US $ 4.0 Billion / Year

/ noilli B 68. 71 $ S U
Collected From Employers of Graduates

r ae Y/ noilli B 88. 4 $ S U
Securitization

r ae Y
Quantized Tobin Tax on Forex Transactions = US $ 3.27 Billion / Year Facility Pending Grant
US $ 3.27 Billion / Year

r ae Y/
/ noilli B 702. 4 $ S U

noilli B 55. 3 $ S U
US $ 10 Billion
Yearly Rent From High FSI Re-Developed
PSU Properties all over India = US $ 10 Billion Education Megaproject
US $ 17.86 Billion For Fund Act
Opex

US $ 4.5 Billion US $ 12.64 Billion


Service Tax Feedback For Opex

Special Act Of Parliament to give


Service Tax US $ 10.0 Billion Annual Rent Received Legal status to SPV and enable
From Developer Partnerships Fast Track Execution based on
@ 10 % Initial Sovereign Guarantees
Education Megaproject Fund

Capacity To Raise & Spend US $ 45 Billion / Year

Indian Social Infrastructure ( ISIC Act )


Corporation ( ISIC )
US $ 45 Billion Revenue
For Created Ecosystem
Spend US $ 45 Billion On Primary & Secondary School Operations / year
+
PHASE II Expansion ( if Any ) through securitization of specific cashflows

18 Million Students On Education Vouchers


30,000 Private School Operators TEACH ( Including 108 Million Students
Under Teacher Sharing Programme )
= 126 Million Children

Service Providers Ecosystem


INSTITUTIONAL STRUCTURES , LAND BANKS AND
URBAN EQUITY WITHDRAWL & MISC ISSUES
The Indian Primary & Secondary Education Mega Project

Government Of India
The Nataraja Foundation Ministry Of Finance
www.nataraja.org.in
Ministry Of HRD

Ministry Of
Disinvestment
( FUTURE SOURCE )
Parliament

ISIC Act

25 % Equity 75 % Equity
Central "The Indian Social Infrastructure Corporation " 28 State
Government sets up Governments
30,000 Acres The Primary & Secondary Education Megaproject SPV 900,000 Acres
Of Land For Setting Up Schools
Of Land all Over
This 9,30,000 Acres , can be visualized approximately as a strip of Land 62 India
Km by 60 Km. It is not much land for India taken as a whole. Out of this, with Land Bank of 9,30,000 Acres all over India
30,000 Acres can be easily spared / collected by the central government
from PSU's and government organizations in Metros and B category
Towns . The balance 9,00,000 Acres will be in Villages and towns in 28
States and 7 Union Territories all over India and will be given out on bids
for setting up Schools and Hospitals. Land For Equity Deal
Service Partners
PPP Contracts
The Indian Comptroller & Auditor General
Commercial Land Bank :
30,000 Acres to be held in Land Bank . Upto 24 % of Cherry Picked land to be sold to Finance 40 % Primary & Secondary Education Of India to Monitor All ISIC Cashflows + All
Capex of Primary & Secondary Education Project / Healthcare Megaproject . Balance 76 % land to Mega Project Sales & Lease Rentals Of ISIC Related Land
be given on rent in towns and cities to large city developers so as to earn Cash to meet project ( Executive Board ) Under This Project.
Operating Cash Requirements so as to subsidize Education and Healthcare provision to Low Income
Groups.

Note on PSU Land Based Urban Equity Withdrawl : 10 % of 30,000 Acres


Cherry Picked
If just 10 % of the land transferred in Metros and Large Towns to the ISIC from PSU's is Prime Real Estate in Big Issue Of initial capital (2015 - 2016).
prime real estate it will be approximately 3,000 Acres ( all over India as the SPV in all will Cities and Important Towns
to be sold to finance 40 % Stock : India Domestic & International Offering
have 9,30,000 acres, of which 30,000 acres will be held in the Land Bank while 900,000 will of Project Capex. All such
go for the school project & Healthcare project). This 10 % land will be worth approximately sales will be under a
Of 500 Million Equity Shares or Rs 100 each
180,000 crores ( Approximate land cost in a Metro per acre has been taken as Rs 60 Crores Transperant bidding For a premium of @ Rs 400 Per Share to raise
while actual prices range from Rs 400 Crores / Acre in Mumbai to Rs 2 Crores / Acre in a process and SPV land sold US $ 5.28 Billion as Equity
will have an FSI ranging
small town ). from 4 - 16 for creation
of Financial Centers in
Bonds : International Bond Offering Sufficient
The land bank will make the SPV one of the highest net worth companies on the Indian Stock major Towns. Thereby For 3 Years of Project Construction :
Exchanges. It will then be possible for the SPV to raise its own resources by selling land maximizing development of
scarce land as also available Targeted Debt / Equity Ratio = 3 : 1
( Through a competitive and transperant bidding process ) to developers or by issuing long funding for the project.
term tax free bonds on par with RBI bonds. Central and state governments will take land from Bond Amount = US $ 15.85 Billion
PSU 's and state government undertakings which are not utilizing the land optimally and Coupon rate =
transfer it to the ISIC which is working towards a National Mission. The Chief Secrateries of Duration = 5 Years
the 28 states will be on the board of the ISIC so each states interests will be fully protected.

Addressing PSU Concerns


To fully accomodate the commercial concerns of PSU and their government and private
shareholders, they will get an enhanced FSI ( either on the same plot or on their other Balance 90 % land to be
The US $ 15.85 Billion Bond issue will help finance any
properties that are not being given away ) . For instance if a PSU is giving away prime real given on rent by ISIC to large developers
from around the world ( including Indian shortfall in Capital Requirements.
estate in Mumbai city which currently has an FSI of 2.66 , they will get an FSI of 3.50 in developers ) to
another property in the same locality ( if they own two properties close to each other and are Provide Operating Cash
giving away only one property) or an FSI of 5.0 in a less valuable location, in a manner that Project Land to Finance Education, Food and Clothing
their commercial interest is protected. They could also be issued TDR's ( Transfer of 900,000 Acres in all to be and Hostel Facilities for needy students from
allocated for Social Low Income Families ( This will however be
Development Rights ) which they could trade on the market or they could receive cash for the just once source for OPEX ). Money to be
Infrastructure Projects in
enhanced FSI that accrues on the actual sale of their plots. So , If the Plot has been granted Education & Healthcare given directly by ISIC to the school operators
an additional FSI of 8 , Cash equivalent of 5.5 FSI will go to the Social Infrastructure without any involvement of local government.
Megaprojects and a cash equivalent of 2.5 FSI will be paid in cash or issued as TDR's to the All such payments and their use to be
monitored by Comptoller & Auditor General
PSU after the sale of land through a transperant bidding process to Indian or International Of India.
consortia , thereby avoiding any litigation from shareholders.

It must be understood however that increased FSI requires increased Infrastructure support
in terms of city amenities and better municipal infrastructure. This needs to be incorporated
into the city's development plan. The land transfers and sales however can proceed
immediately and need not wait for the city development plans to be changed. Execute US $ 131.38 Billion Primary &
Secondary Education Mega Project between
2012 - 2023

Bootstrap I Bootstrap II Phase I Phase II Phase III


Q1 - Q4 2011 Q1 - Q4 2012 2012-2014 2015-2017 2018-2023

School Megaproject Enabling School Megaproject Enabling Total Schools 6000 Total Schools 9000 Total Schools 15000
Infrastructure Infrastructure
Teachers
Teachers Training Training Day Schools 5100 Day Schools 7650 Day Schools 12750
100 100
Schools Schools
Residential 900 Residential 1350 Residential 2250
Master Masons * 30 Master Masons* 30 Schools Schools Schools
Training Schools Training Schools
* Master Masons to be trained in the * Master Masons to be trained in the
Vernarcular Architecture Style Vernarcular Architecture Style

Once trained , Master Masons and Teachers could organize themselves into Guilds ( Not Cooperatives ). The Masons Guilds could bid for contracts to build the schools / hospitals.

Note on SPV Executive / Regulatory Powers :

The BOO / BOT concession for the Primary & Secondary Schools will be given with all necessary clearences and professional affiliations in a single window. If a promoter group / concession awardee fails
to meet certain transparant criteria ( specified in a 1 page rule book ), the concession will be terminated and offered to a new developer ... there will be no appeal to any court and the 1 page rulebook will
be very clear on concession termination issues.

Same structural vehicle / arrangement can be used to finance higher education.

Governance : Project & Operations Phase

There are huge cashflows involved in both the project execution and operations phases of the Indian Primary & Secondary Education Megaproject . The execution phase will involve the raising and
expenditure of approximately US $ 131.38 Billion or Rs 597,651 crores between 2011 and 2023 and the operations phase will involve project revenues and rent allocations ( which will help approx. 126
million children to receive quality education free of cost ) of approximately US $ 42.57 Billion each year after 2023.
Governance : Project & Operations Phase

There are huge cashflows involved in both the project execution and operations phases of the Indian Primary & Secondary Education Megaproject . The execution phase will involve the raising and
expenditure of approximately US $ 131.38 Billion or Rs 597,651 crores between 2011 and 2023 and the operations phase will involve project revenues and rent allocations ( which will help approx. 126
million children to receive quality education free of cost ) of approximately US $ 42.57 Billion each year after 2023.

The scale of cashflows needs to be monitored in a transparent manner and the Megaproject needs to be open to public audit. It is therefore an explicit requirement of the project that it be executed in a
corporate setup, outside the concerned ministries , under government of India and to implement a context based communications platform for project MIS. In fact , it is better not to execute this
project , than to do it within a ministry or the existing education systems where information in-efficiencies and leakage of funds will undermine the very basis of the projects and lead to huge
cost and time over-runs.

The project needs therefore to be executed and operated in a corporate setup , under a Special Project Vehicle ( SPV ) set up under an act of Parliament ( The ISIC ) in the same manner as
organizations such as IOC, ONGC, NHAI , IIFC and UTI were set up. The chief secretary’s of all states , The Chairman of the National Knowledge Commission, The Secretary , Ministry of HRD, the
Deputy Chairman of the Planning Commission, The Minister of HRD will be members of the board. The responsibility for audit of the organization will vest with the Auditor General of India.

The Masons guilds are a very important part of this project as they will generate huge employment opportunities in rural india. As envisaged however , the guilds will essentially be self governing and
market forces. will decide their profitability. Government or local political control on these cooperatives will kill these guilds and therefore it is essential to protect their interests only through broad , non-
interfering regulation. The guilds must therefore never be turned into cooperatives which breed corruption and in-efficiency.
Stand Alone ( Day School ) Facility With 300 Children X 2 Shifts, Full www.nataraja.org.in
Time 51 Teachers + 7 Visiting Faculty Zero Drop out rate is being assumed
IMPORTANT NOTE ON OPERATING FINANCIALS OF THE SCHOOLS: Floor Space Required ( Class
due to superior teaching inputs … Room + Hostel ) in Sq Ft @
Fractional Vouchers in Day schools Project will rely less on pull factors such
will provide Rs 850 / Sq Ft … This includes
This project works because the Education SPV provides for2/3 subsidy.
the total costs of education for 18 as
Million
Mid DayChildren ( In the
Meal Scheme Hub
& More onSchools) . Theconstruction & Furniture
Vouchers also include the cost of the teacher sharing programme which reaches another Better Children
108 Million and InspiringwhoTeachers
are attopresent
keep covered byrequired
For ease of calculations students students in school.
the Sarva Shiksha Abhiyan ( SSA ). A total of 126 Million Children
on fractional are are
vouchers therefore covered with the best teaching resources possible.
added in
the end.
This spreadsheet Looks exclusively at the financial viability of the schools from the point of view of private developers / Consortia who
will be investing just Rs 0.88 Crore equity each and raising the balance of their 60 % share as Interest free debt during the construction
period from the World Bank / Asian Development Bank . Here again Government of India will back this debt with a revolving $ 10 Billion
sovereign loan guarantee and take on the cost of the debt during the construction period. After the construction is complete, the World Bank /
Asian Development Bank will be replaced in the financial structure by a commercial bank and the debt will carry a normal market rate of
interest . The project developer will pay back this loan and any interest that will be due.

The ISIC raises all the money required through unique and innovative financing. Please read the project concept document for more
details on financing
Stand Alone Residential Facility With 600 Children ( Residents )+ 200 Children as www.nataraja.org.in
Day Scholars , 51 Full Time Teachers + 7 Visiting Faculty Zero Drop out rate is being assumed
IMPORTANT NOTE ON OPERATING FINANCIALS OF THE SCHOOLS: due to superior teaching inputs … Floor Space Required ( Class
System has sufficient inbuilt Project will rely less on pull factors such Room + Hostel ) in Sq Ft @
This project works because the Education SPV provides
capacity for the total costs
for de-bottlenecking. of education for 18 Day
as Mid Million
MealChildren
Scheme &(MoreIn the Rs 850 / Sq Ft … This includes
on Hub Schools) . The
at present coveredconstruction
Better and Inspiring Teachers & Furniture
Vouchers also include the cost of the teacher sharing programme which reaches another 108 Million Children who to keep
are by
required
the Sarva Shiksha Abhiyan ( SSA ). A total of 126 Million Children students
are therefore covered with in school.
the best teaching resources possible.

This spreadsheet Looks exclusively at the financial viability of the schools from the point of view of private developers / Consortia who
will be investing just Rs 1.75 Crore equity each and raising the balance of their 60 % share as Interest free debt during the construction
period from the World Bank / Asian Development Bank . Here again Government of India will back this debt with a revolving $ 10 Billion
sovereign loan guarantee and take on the cost of the debt during the construction period. After the construction is complete, the World Bank /
Asian Development Bank will be replaced in the financial structure by a commercial bank and the debt will carry a normal market rate of
interest . The project developer will pay back this loan and any interest that will be due.

The ISIC raises all the money required through unique and innovative financing. Please read the project concept document for more
details on financing
The Nataraja Foundation
www.nataraja.org.in

Economics Of The Teacher Sharing Programme :


It is felt that teachers ( many of them women ) will need a place to rest and refresh themselves during their work
in the villages. A guesthouse has therefore been created in the area close to each of the assisted schools. This will
allow for further expansion of the programme. The guesthouses will also allow for overnight stay.

Sample Teacher Guest houses


1. Teacher Guesthouses Cost : Rs 850 / Sq Ft

A small teacher guesthouse will be constructed in the environs of each of the 14 assisted village

Teacher Guesthouse Costing :


Cost

Cost of 1200 Sq Ft guesthouse @ Rs 850 / Sq Ft 10.2


Land Development Cost @ 15 % of Guesthouse cost 1.53
Guesthouse Furnishing 2
Land Cost ( land given by government for free ) 0

Total Cost 13.73

Total Cost of 30000 X 14 Guesthouses ( 420,000 Guesthouses ) 57666

2. Vehicle / Fuel Costs For The Teacher Sharing Programme

Type Of Vehicle Qty Of Distance Mileage Cost of Diesel Total Running


Vehicle Travelled ( Rs / Litre ) Cost / Day
/ Day

Large Buses 2 50 4 40 1000.00


Mini Vans 2 50 6 40 666.67
Jeeps 4 75 10 40 1200.00
Cars 4 75 12 40 1000.00

TOTAL COSTS
Assumptions
All assisted schools will be within a 50 Km radius of the hub school
Each Small Vehicle Does 75 Km / Day on Average and Each Bus / Minibus travels 50 Km / Day
Cost of Diesel @ Rs 40 / Litre. Global petroleum markets are volatile and marginal pricing economics c

Mileage Assumptions
Km / Litre
Of Diesel
Bus 4
Mini Bus 6
Jeep 10
Car 12

Notes :

1. Driver & helper costs are included in staff costs


2. Teacher costs are included in the school costs and therefore not priced here.
mme : Architect : RL Kumar
Bangalore )
(

h themselves during their work


f the assisted schools. This will
ernight stay.

Teacher Guest houses


s 850 / Sq Ft

ch of the 14 assisted village school

Lakhs
Lakhs
Lakhs

Crores

Total Running Maintenance Total Total Operating


Cost / Year of Cost / Year / Maintenanc Cost of Fleet Per
250 Days Vehicle e Cost Year

250000.00 30000 60000 310000.00


166666.67 25000 50000 216666.67
300000.00 10000 40000 340000.00
250000.00 10000 40000 290000.00

966666.67 190000 1156666.67


ool
s travels 50 Km / Day
d marginal pricing economics constrain upward price view.

t priced here.
Project is capable of financing the
launch of upto 12 New EDUSAT
Statellites beginning in 2013 and
can also finance the replacement of
these satellites every 7 years.

The Nataraja Foundation


www.nataraja.org.in

Network Enabled E Learning

Children exploring the $ 100 Computer Pres. Kalam inaugurates a Portal ISRO - GSLV Prepares to Launch EDUSAT A Village Trainer introducing childr

Internet / Network Enabled Learning


The Education Megaproject is divided into two phases ( Phases I & II ).

PHASE II : The Contextual Commu


PHASE I : Improving The Current System

The Education Mwegaproject has cho


Phase I of the project will be initiated immediately with the objective of on the performance that such a system
improving the current MIS within the Sarva Shiksha Abhiyaan ( SSA ). very large and complex project such
whole system seamlessly into its oper
Phase I will have 3 objectives :
During project planning and execution
1. Improve Fund Flow Predictibility & Velocity
In the Operations phase ... system w
Reduce the time it takes for funds to flow from the Ministry Of HRD in Delhi Children.
to schools in rural india from 3 - 4 months currently ... to just 2 - 3 days.
This will be achieved by implementing a new internet based information For a detailed write-up on the contex
If the document below does not open
architecture which will send out E mail messages and SMS's to school pointed out by the arrow :
principals informing them about the quantum of funds that have been on clicking …pls go to the Abraham
sanctioned for their schools and exactly what the grant can be spent on Lincoln's Letter Worksheet. The
( Furniture, Toilets , Computers etc ). Today even school principals have no same file is stored there as well. A description if the IT Infrastructure
idea what the money they receive can be spent on ... this problem will now
be resolved.
INTERNET / NETWORK ENABLED L
2. Improve Transparency / Visibility within the system
Please note that the plan below wi
Phase I of the IT implementation will execute a context based regional school cluster. The Teach
communications system which will dramatically improve the visibility of scale deployment of IT infrastructu
people and officials within various ministries.
One of the major strengths of the Ed
Specifically it will do the following : large amount of financial resources
8 different sources of financing.
1. If someone is holding up decisions for more than 10 days the system
will generate an E mail alert which will be sent to his / her Network enabled learning is one of the
superiors and to the individual schools which are affected. All schools have adequate resources.
and funds will be mapped to certain material codes / budget codes
to enable this functionality. This will greatly improve accountability. The 30,000 schools set up under th
constitute the largest E Learming ne
2. If for any reason money allocated for one purpose is used for another level backed by sophisticated fiber
purpose, the system will send out an E mail alert to all concerned. satellites specially launched for the pu
Special Note : However , E Learning needs to be
3. Improve Real Time Response by competent teachers to conv
One of the fundamental ideas behind this systems to millions of children who w
Phase I of the project will also put in place new architecture which will project is to use Communication technologies
allow access to the latest information about each school. Today the and the internet to further develop Vernacular There can be no substitute for a good
information about schools ( On the SSA website ) is at least 2 years old. Languages and local cultures of the different the children inculcate their values. T
states of India. impression that the internet and c
This particular part of phase I will extend into the actual Megaproject when purposes of this project therefore we
the larger quantum of funds will become available. Let us use the power of the internet to enable a enabled internet based learning as jus
massive exchange of ideas among the many
different cultures of India.

English is the language of International


STAGE I : Jan 2013 - Dec 201
commerce but a majority of our people do not
A. Connection To Existing Telecom
know English. There is a need therefore to use
technology to empower the Tamilian farmer who
In India we already have close
knows no other language but his mothertongue
fiber carrying capacity is virtually unlim
or the Mizo tribal or the Bengali artisan who has
amplification , telecom companies
no use for english in his daily life. Why should
their capacity at a concessional rat
the poor be put at a disadvantage just because
knowledge network that will operate
they do not know English ?
systems to millions of children who w
Phase I of the project will also put in place new architecture which will project is to use Communication technologies
allow access to the latest information about each school. Today the and the internet to further develop Vernacular There can be no substitute for a good
information about schools ( On the SSA website ) is at least 2 years old. Languages and local cultures of the different the children inculcate their values. T
states of India. impression that the internet and c
This particular part of phase I will extend into the actual Megaproject when purposes of this project therefore we
the larger quantum of funds will become available. Let us use the power of the internet to enable a enabled internet based learning as jus
massive exchange of ideas among the many
different cultures of India.

English is the language of International


STAGE I : Jan 2013 - Dec 201
commerce but a majority of our people do not
A. Connection To Existing Telecom
know English. There is a need therefore to use
technology to empower the Tamilian farmer who
In India we already have close
knows no other language but his mothertongue
fiber carrying capacity is virtually unlim
or the Mizo tribal or the Bengali artisan who has
amplification , telecom companies
no use for english in his daily life. Why should
their capacity at a concessional rat
the poor be put at a disadvantage just because
they do not know English ? knowledge network that will operate

B. ISRO EDUSAT enabled VSAT Ter


So while English will have its place in commerce,
the massive E - Learning infrastructure being set
However, to reach remote locations o
up by this project needs to be also used ,
to provide Video, Voice and data se
through appropriate policy measures to catalyze
financed by the project SPV and
a large local language content industry with
thousand locations :
people from every region of India putting their
best works and their practical ideas in every
1. 384 Kbps VSAT Terminal : Rs 2
field, in their own vernacular medium on the
2. Projector + Screen : Rs 2
internet.
3. Switch / Router / cabling
and 6 terminals : Rs 3
---------
Total Cost Per School Rs 7
---------

For 30,000 schools built over a period

Normally a 384 Kbps of leased VSA


approx Rs 7000 / Kbps / Year) ... so f
Since the Capex is low and the Oper
for the SPV to own its own satellites.

Satellite Launches To Commence in

With a view to minimizing the opera


ISRO to launch the ISRO EDUSAT's
launch a total of 6 EDUSATs before
would have been commissioned.

Cost of each EDUSAT , including la


involve an expenditure of US $ 1.65 B

A total of 21,000 schools will then ha


21,000 schools , the Project SPV wil
rural schools,thereby bringing a total
January 2016. Given the above, t
15,250 Crores.

STAGE II : Feb 2016 - Dec 201


Stage II will involve the launch of
then, we will have a more advanced
have reached every school in the cou

Telecommunication technologies are


G and other broadband technologies
of schools on the network. Actually th
need for VSAT and Satellite deploym
Screen ) is found to be a cheaper solu

Note :

The current plan is looking at just th


the market and a futuristic plan can
are more qualified to deal with this s
EDUSAT for launch in 2014.

Ideas to improve this E - Learning mo


ect is capable of financing the
ch of upto 12 New EDUSAT
ellites beginning in 2013 and
also finance the replacement of
e satellites every 7 years.

A Village Trainer introducing children to the Internet

HASE II : The Contextual Communications Platform

he Education Mwegaproject has chosen a contextual communications platform based


n the performance that such a system is capable of delivering , first while executing a
ery large and complex project such as the Megaproject and then while migrating the
hole system seamlessly into its operations phase.

uring project planning and execution ... system will deliver huge cost savings

the Operations phase ... system will allow for network enabled learning for upto 126 Million
hildren.

or a detailed write-up on the contextual communications platform please click on the document
ointed out by the arrow :

description if the IT Infrastructure that is proposed to be set up now follows :

NTERNET / NETWORK ENABLED LEARNING

lease note that the plan below will need to be changed to accomodate the needs of each
egional school cluster. The Teacher sharing programme may reduce the need for a large
cale deployment of IT infrastructure if recorded content and Laptops are a cleaper option.

ne of the major strengths of the Education Megaproject and it's financing mechanism is the
rge amount of financial resources that it is capable of raising to fund its projects based on it's
different sources of financing.

etwork enabled learning is one of the key projects that will be financed for which the SPV will
have adequate resources.

he 30,000 schools set up under this project and the 420,000 additional assisted schools will
onstitute the largest E Learming network globally at the primary and secondary school
vel backed by sophisticated fiber optic networks and upto 12 EDUSAT communication
atellites specially launched for the purposes of this project by ISRO.

owever , E Learning needs to be used and understood for what it is - A tool to used
y competent teachers to convey the right knowledge inputs and the right value
ystems to millions of children who will be on the network.

here can be no substitute for a good teacher at the primary and secondary school level where
e children inculcate their values. This point is made specifically since people have a wrong
mpression that the internet and computers will solve all our national problems. For the
urposes of this project therefore we are looking at E - learning, VSAT broadband and 3 G
nabled internet based learning as just a tool ... to enable learning.

TAGE I : Jan 2013 - Dec 2015


. Connection To Existing Telecom & Fiber Optic Networks

India we already have close to 400,000 Km of Fibre Optic Cables in the ground. Since
ber carrying capacity is virtually unlimited , a fact made possible by multiplexing and optical
amplification , telecom companies operating in India can be required to lease some of
eir capacity at a concessional rate for the purposes of building the government backed
nowledge network that will operate between high traffic nodes on the school network.
ystems to millions of children who will be on the network.

here can be no substitute for a good teacher at the primary and secondary school level where
e children inculcate their values. This point is made specifically since people have a wrong
mpression that the internet and computers will solve all our national problems. For the
urposes of this project therefore we are looking at E - learning, VSAT broadband and 3 G
nabled internet based learning as just a tool ... to enable learning.

TAGE I : Jan 2013 - Dec 2015


. Connection To Existing Telecom & Fiber Optic Networks

India we already have close to 400,000 Km of Fibre Optic Cables in the ground. Since
ber carrying capacity is virtually unlimited , a fact made possible by multiplexing and optical
amplification , telecom companies operating in India can be required to lease some of
eir capacity at a concessional rate for the purposes of building the government backed
nowledge network that will operate between high traffic nodes on the school network.

. ISRO EDUSAT enabled VSAT Terminals

owever, to reach remote locations on the school network, 384 Kbps VSAT's can be deployed
o provide Video, Voice and data services to children in remote schools. These VSATs will be
nanced by the project SPV and the following configuration can be provided at several
ousand locations :

1. 384 Kbps VSAT Terminal : Rs 2.0 Lacks


2. Projector + Screen : Rs 2.0 Lacks
3. Switch / Router / cabling
and 6 terminals : Rs 3.0 Lacks
--------------------
Total Cost Per School Rs 7.0 Lacks
-------------------

or 30,000 schools built over a period of 10 years , the total cost will be Rs 2100 Crores.

ormally a 384 Kbps of leased VSAT bandwidth would cost Rs 26.88 Lakhs / year ( Rate is
pprox Rs 7000 / Kbps / Year) ... so for 30,000 schools the cost would be Rs 8064 Crores / year .
ince the Capex is low and the Operating leased line costs are extremely high ... it makes sense
r the SPV to own its own satellites.

atellite Launches To Commence in Mid 2013

With a view to minimizing the operating costs of the Network,the SPV will enter into a JV with
SRO to launch the ISRO EDUSAT's in batches of 2 each every year from 2013 itself ... to
unch a total of 6 EDUSATs before January 2016 by which time almost 14000 New schools
ould have been commissioned.

ost of each EDUSAT , including launch cost is estimated at US $ 275 Million. So Phase 1 will
volve an expenditure of US $ 1.65 Billion on the 6 satellites.

total of 21,000 schools will then have access to the EDUSAT linkage. In addition to the
1,000 schools , the Project SPV will finance the installation of VSAT terminals at 80,000 more
ural schools,thereby bringing a total of 1,00,000 schools within the EDUSAT's coverage by
anuary 2016. Given the above, the total installed cost of Phase I will be approximately Rs
5,250 Crores.

TAGE II : Feb 2016 - Dec 2018


tage II will involve the launch of another 6 EDUSAT satellites if necessary ( Hopefully by
en, we will have a more advanced satellite from ISRO ) as fiber optic based systems may
ave reached every school in the country by then.

elecommunication technologies are continuously evolving and costs keep coming down . 3
and other broadband technologies can be therefore deployed to get an increasing number
schools on the network. Actually the teacher sharing programme may considerably reduce the
eed for VSAT and Satellite deployment if recorded content on laptops ( using a Projector &
creen ) is found to be a cheaper solution.

ote :

he current plan is looking at just the execution of a project to deploy technologies currently in
e market and a futuristic plan can be incorporated based on advice from technologists who
re more qualified to deal with this subject. This project is already assuming a higher capacity
DUSAT for launch in 2014.

eas to improve this E - Learning module of the project are therefore very welcome.
Project Bootstrapping & Support Required

The Nataraja Foundation Architect : Laurie Baker ( Cost Ford ) , Kerala


www.nataraja.org.in

27 th March ' 2010

Kindergarten , Auroville
Pondicherry

Architect : Auroville Architects

The Primary & Secondary Education Megaproject needs some help from the Government of India to get off th

The following support is required from the Govt. Of India :

1. To enable fast track execution of this project, Government needs to initiate a total of 70 pilot projec
across 28 states and 7 Union Territories. Each pilot project will include :

- A school for 600 students ( design capacity of 300 students and operating in 2 Shifts )
- A large rural teachers training facility to train 300 teachers each year
- A Masons training facility to train 300 masons in Vernacular / Low cost / sustainable architecture

Each of the 70 pilot projects will require between 150 – 200 acres of land for the above activities.

2. A Statutory Organization “The Indian Social Infrastructure Corporation “ will need to be created under
act of Parliament. The legal status of this organization and It’s financial structure / means of financing a
made available for free download on (www.nataraja.org.in) with the caption “Legal and Financial Structu

3. A statutory fund named “The Indian Education Megaproject Fund “ will need to be created under an Act
Parliament. This fund will be on the lines of the “Central Road Fund “ , which has been created to build t
Golden Quadrangle Project. Therefore the passage of “The Education Megaproject Fund Act “ is critical
put this project into execution mode.

4. A new tax proposal on the lines of the recently implemented tax, on the services component of housi
projects (2010 Budget) will need to be implemented to extend service tax to the labour and servic
component of Infrastructure projects. This will very easily generate a new cash source for creating th
human resources necessary to plan and build large Infrastructure projects in India. At present, there
a shortage of 30 million trained people in the construction Industry alone. So the imposition of a serv
tax on the labour / skill component of Infrastructure projects is fully justified.

5. An initial corpus needs to be set aside, to set up the 70 pilot projects including the model schoo
Parliament. This fund will be on the lines of the “Central Road Fund “ , which has been created to build t
Golden Quadrangle Project. Therefore the passage of “The Education Megaproject Fund Act “ is critical
put this project into execution mode.

4. A new tax proposal on the lines of the recently implemented tax, on the services component of housi
projects (2010 Budget) will need to be implemented to extend service tax to the labour and servic
component of Infrastructure projects. This will very easily generate a new cash source for creating th
human resources necessary to plan and build large Infrastructure projects in India. At present, there
a shortage of 30 million trained people in the construction Industry alone. So the imposition of a serv
tax on the labour / skill component of Infrastructure projects is fully justified.

5. An initial corpus needs to be set aside, to set up the 70 pilot projects including the model schoo
teachers training institutes and Masons training institutes. All this initial money that the governme
spends upfront will be returned by the “ The Indian Social Infrastructure Corporation ” within 2 –
years with interest calculated at 12 %. The rest of the project (balance 30,000 schools) will be bu
without any further demands on conventional means of financing .
t Required

Laurie Baker ( Cost Ford ) , Kerala

Deens Academy
Whitefield,
Architect
Bangalore
: RL Kumar
Cost : Rs 690 / Sq Ft
Architect : RL Kumar

ernment of India to get off the ground.

te a total of 70 pilot projects

erating in 2 Shifts )

/ sustainable architecture

or the above activities.

l need to be created under an


cture / means of financing are
“Legal and Financial Structure “..

to be created under an Act of


h has been created to build the
aproject Fund Act “ is critical to

ervices component of housing


tax to the labour and services
w cash source for creating the
ts in India. At present, there is
. So the imposition of a service

s including the model schools,


h has been created to build the
aproject Fund Act “ is critical to

ervices component of housing


tax to the labour and services
w cash source for creating the
ts in India. At present, there is
. So the imposition of a service

s including the model schools,


al money that the government
cture Corporation ” within 2 – 3
e 30,000 schools) will be built
Abraham Lincolns letter to his son’s headmaster.
Written sometime in the late 1850’s … early 1860’s Project Design Basis Document / Project Ph

Respected Teacher,

He will have to learn,


I know,
that all men are not just,
all men are not true.

But teach him also that


for every scoundrel there is a
hero;
that for every selfish politician,
there is a dedicated leader …

Teach him for every enemy


there is a friend
it will take time , I know;
but teach him if you can,
that a dollar earned is of
far more value than
five found …
teach him to learn to lose …
and also to enjoy winning.

Steer him away from envy,


if you can,
teach him the secret of
quiet laughter.

Let him learn early that


the bullies are the easiest to
lick …

Teach him, if you can,


the wonder of books …
but also give him quiet time
to ponder the eternal mystery
of birds in the sky,
bees in the sun,
and the flowers on a green
hillside.

In the school teach him


if is far more honourable to fail
than to cheat …
MEGAPROJECT INFORMATION
Teach him to have faith
in his own ideas,
even if everyone tells him
they are wrong …

Teach him to be gentle


with gentle people,
and tough with the tough,

Try to give my son


the strength not to follow the
crowd when everyone is
getting on the band wagon …
Teach him to have faith
in his own ideas,
even if everyone tells him
they are wrong …

Teach him to be gentle


with gentle people,
and tough with the tough,

Try to give my son


the strength not to follow the
crowd when everyone is
getting on the band wagon …

Teach him to listen to all men …


but teach him also to filter
all he hears on the screen of truth,
and take only the good
that comes through

Teach him if you can


how to laugh when he is sad …
teach him there is no shame in
tears,

Teach him to scoff at cynics


and to beware of too much
sweetness …

Teach him to sell his brawn


and brains to the highest
bidders
but never to put a price-tag
on his heart and soul.

Teach him to close his ears


to a howling mob
and to stand and fight
if he thinks he’s right.

Treat him gently


but do not cuddle him,
because only the test
of fire makes fine steel.

Let him have the courage


to be impatient …
let him have the patience to be
brave.

Teach him always


to have sublime faith in
himself,
because then he will have
sublime faith in mankind.

This is a big order,


but see what you can do …
he is such a fine fellow,
my son !

… Abraham Lincoln

“ With malice towards none … with justice for all … with firmness in the right "
but see what you can do …
he is such a fine fellow,
my son !

… Abraham Lincoln

“ With malice towards none … with justice for all … with firmness in the right "
esign Basis Document / Project Philosophy

Megaproject Information
Architecture

MEGAPROJECT INFORMATION ARCHITECTURE


Any Syllabus as prescribed and regulated by Central & State
Government Statutory Authorities is OK
ated by Central & State
orities is OK
Project Concept Submitted To :

SL. No. Name

1 Dr. Montek Singh Ahluwalia


2 Ms.Anshu Vaish
3 Mr. Arun Ramanathan
4 Mr. Ashok Chawla
5 Mr. Govind Mohan

6 Dr. APJ Abdul Kalam

National Knowledge Commission

7 Mr. Sam Pitroda


8 Dr. Ashok Ganguly
9 Dr. P. Balaram
10 Dr. Jayati Ghosh

11 Dr. Deepak Nayyar

12 Mr. Nandan Nilekani

13 Ms. Sujatha Ramdorai

14 Dr. Amitabh Mattoo


15 Mr. S Regunathan
16 Ms. Kumud Bansal
17 Ms. Kiran Datar
18 Mr. CNS Nair
19 Mr. Sunil Bahri
20 Mr Amlan Goswami
21 Ms Namita Dalmia
22 Ms Megha Pradhan
23 Ms Sukhman Randhawa
24 Mr Vikas Bagri
25 Ms Deepti Ayyanki
26 Ms Aashima Seth
Designation & Official Details

Dy. Chairman Planning Commission, Govt. Of India


Secretary,School Education & Literacy , Ministry Of HRD, Govt. Of India
Finance Secretary, Ministry Of Finance, Govt. Of India
Secretary, Economic Affairs, Ministry of Finance, Govt. Of India
Jt. Sec, ( Infrastructure ) , Dept Of Economic Affairs, Govt. Of India

Former President Of India

Chairman, NKC
Member, NKC
Member, NKC
Member, NKC

Member, NKC

Member, NKC

Member, NKC

Member, NKC
Advisor, NKC
Advisor, NKC
Advisor, NKC
Advisor, NKC
Executive Director NKC
Research Associate
Research Associate
Research Associate
Research Associate
Research Associate
Research Associate
Research Associate
E Mail Address Used To Submit Project

dch@nic.in
secy.sel@nic.in
secy-fs@nic.in
secy-dea@nic.in
govindmohan1@yahoo.com

apj@abdulkalam.com

s.pitroda@nic.in, anna.faron@c-sam.com
a.ganguly@nic.in, ashok.ganguly@firstsource.com
p.balaram@nic.in, pb@mbu.iisc.ernet.in
j.ghosh@nic.in , jayatijnu@gmail.com

d.nayyar@nic.in , deepaknayyar@mail.jnu.ac.in, nayyar.deepak@gmail.com

n.nilekani@nic.in,nandan_mn@infosys.com
s.ramdorai@nic.in, sujatha@math.tifr.res.in
amitabh.mattoo@gmail.com
s.regunathan@nic.in
k.bansal@nic.in
k.datar@nic.in
E Mail Not available
s.bahri@nic.in
a.goswami@nic.in
n.dalmia@nic.in
m.pradhan@nic.in
s.randhawa@nic.in
v.bagri@nic.in
d.ayyanki@nic.in
a.chaney@nic.in