India’s EdTech Goldmine: What the Startup Policy Needs to Unlock It
By Arpit Mittal
India values education deeply. Nalanda University, founded in the 5th century BCE, was the world's first residential university. Now India leads in digital education with over 17,000 EdTech companies. Seven are unicorns, second to America's thirteen as of December 2024. The Indian EdTech industry is worth $7.5 billion in 2024 and will likely reach $29 billion by 2030, growing at 25.8 per cent CAGR according to IAMAI. Creating more unicorns demands policy changes that tackle specific challenges.
Expanding Digital Infrastructure and Accessibility
Internet users drive EdTech growth in India. IAMAI-Kantar reports show active users will hit 900 million by 2025 from 622 million in 2020. Smartphones drive this trend. Currently, nine out of ten active internet users access the internet daily, spending an average of two hours online. While a large share of internet consumption is for entertainment, social media, and gaming, education is also becoming a dominant use case.
India's startup policy has to place a strong priority on expanding internet connectivity in rural and semi-urban areas in order to accelerate the growth of EdTech. Enhancing broadband infrastructure, supporting public-private partnerships, along with offering telecom firms incentives to increase last-mile connectivity, are some ways for accomplishing this. Cost-effective data plans, like those provided during India's digital revolution, can make education more accessible to students from a wider range of socioeconomic backgrounds.
Addressing the Skill Gap and Enhancing Employability
India produces millions of graduates yearly, but few are job-ready. Mercer-Mettl's Graduate Skill Index 2025 shows that only 42.6 per cent are employable. Graduates from Tier-I colleges have the highest employability at 48.4 per cent, followed by Tier-II (46.1 per cent) and Tier-III (43.4 per cent) institutions. Among states, Delhi (53.4 per cent), Himachal Pradesh (51.1 per cent), and Punjab (51.1 per cent) produce the most employable graduates, owing to quality education, industry collaborations, and favourable economic conditions. Schools teach theory. Companies want practical skills in AI, data analytics, and coding. Most graduates lack these abilities. Traditional education also ignores soft skills like communication and problem-solving.
Policies should push EdTech companies, universities, and businesses to work together. Support industry-led certification programs. Fund internships. Back to AI-based skill assessment tools. English proficiency plays a critical role in employability, especially in urban centres where multinational companies seek candidates with strong communication skills. Government support for AI-powered English learning platforms in regional languages like Tamil, Telugu, Oriya, Gujarati, and Bengali can ensure broader access to quality language training within a familiar linguistic context. EdTech platforms teaching professional skills and languages will boost graduate job prospects significantly.
Promoting AI and Personalised Learning in EdTech
Personalisation gives EdTech companies an edge. AI platforms offering instant feedback, custom learning paths, and interactive features are winning users. Tools using Generative AI, Speech Technology, and Large Language Models make language learning and skill development more effective. These innovations transform learning experiences for different learning styles.
Government policy should reward AI-driven EdTech with research grants, tax breaks, and regulatory help. Partner with global AI research centers to boost innovation in adaptive learning. Supporting AI adoption will make India a world leader in EdTech.
Strengthening Investor Confidence and Sustainable Funding Models
EdTech in India has attracted $14 billion in total investment, with over $1.1 billion in the past two years, per IAMAI. Investors now favour startups with strong business models and clear profit strategies. Companies must balance affordability with sustainability.
Policies should promote diverse funding approaches: revenue-sharing deals, impact investing, and subscription models. Easing foreign investment rules for EdTech will attract global capital and create more unicorns.
Strengthening Data Privacy and Compliance Frameworks
EdTech growth raises data privacy and security concerns. Student information needs protection from breaches and misuse. India's Data Protection Bill will strengthen oversight in digital education once fully implemented.
Smart EdTech startups will adopt strict data security practices voluntarily. The government should provide compliance training, security funding, and certifications for companies following global standards. Clear regulations build user trust and increase the adoption of digital learning tools.
India needs targeted policies to create more EdTech unicorns. It needs to focus on areas like digital infrastructure, job readiness, AI learning tools, sustainable funding, and data privacy. Also, the inclusion of AI-powered English learning in regional languages can significantly enhance employability, ensuring that language is not a barrier to job opportunities in different cities. Focusing on these areas will establish India as a global EdTech leader and build a more skilled workforce. Technology can extend India's educational tradition and make quality learning available to everyone, regardless of background.
The EdTech sector has an important role to play. Policy changes can help India capitalise on its advantages, facilitate a massive student population, technological talent, and entrepreneurial drive. With the right support, Indian EdTech can transform education globally while solving domestic skills challenges.
EdTech success requires collaboration between government, startups, investors, and educational institutions. No single entity can overcome the complex barriers to digital education at scale. Policy must create an ecosystem where innovation thrives, investment flows, and learning outcomes improve measurably.
India's education system served previous generations well, but it needs reinvention for the digital age. EdTech startups are pioneering this transformation. Smart policies will accelerate their impact, driving economic growth through unicorns while preserving India’s strong educational legacy and making quality learning accessible to all.
(The author is the Founder & CEO of SpeakX)
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