TL;DR
- India invented the university. Nalanda and Takshashila predate Oxford by centuries and were free to all who qualified – funded by kings, merchants, and communities, never by tuition.
- The Gurukul tradition enshrined knowledge as sacred – never transactional, never priced beyond reach.
- Today, Indian families spend 20-30% of their annual household income on education. Private school costs have risen nearly 90% in a decade. Secondary-level dropout rates stand at 8.2%, with financial pressure cited as a primary cause.
- India’s public education expenditure – at 4.12% of GDP – falls below its own NEP 2020 target of 6%, and below the spending levels of countries far less wealthy.
- The contradiction is not incidental. It is structural. And it is costing India the very human capital it claims to be building.
- A circular book economy is not a luxury response to this crisis. It is one of the most immediate, practical things that can change today.
There is a moment in the Mahabharata – one of the oldest and most complete narratives of Indian civilisation – where a young student named Ekalavya approaches the great teacher Dronacharya seeking instruction in archery. Drona refuses. Ekalavya, undeterred, builds a clay statue of the guru, teaches himself in its presence, and becomes arguably the finest archer in the epic.
The story is usually told as one of determination. Of the student who refused to be stopped.
But read it differently – read it as a story about access – and it becomes something else entirely. The most gifted student of his generation was denied a teacher because of who he was, where he came from. He had to find another way. And even then, when his talent became undeniable, the system extracted a price: Drona asked for his thumb, the source of his skill, as payment.
India has always had this tension at its centre. A civilisation that elevated knowledge to the sacred – that produced Nalanda and Takshashila, Aryabhata and Chanakya, a philosophical tradition that is among the richest in human history – has also, simultaneously, found ways to make that knowledge inaccessible to those who needed it most. The reverence was never in question. The access always was.
We are living that tension right now. And the price being extracted – from families, from students, from India’s own future – is higher than most of us have stopped to calculate.
What India Once Built
Let us start where the story should start: with what India actually created, and what it means.
Takshashila, located in what is now Pakistan’s Punjab province, is widely regarded as one of the world’s first universities. It was flourishing as early as the 6th century BCE – centuries before Plato founded his Academy, centuries before Alexander reached its gates. Students travelled to Takshashila from Babylon, Greece, Persia, and across the Indian subcontinent. The subjects taught ranged from Vedas and philosophy to medicine, mathematics, astronomy, political science, and the art of warfare. Chanakya – the author of the Arthashastra, arguably the most comprehensive treatise on statecraft ever written – studied and later taught here.
At Takshashila, knowledge was considered sacred and no fees were charged. Imparting education was regarded as the highest form of donation. Students who could pay, paid. Students who could not, studied anyway – serving the teacher’s household in exchange for instruction.
Nalanda came later – founded in the 5th century CE in present-day Bihar – and surpassed even Takshashila in scale and ambition. What set Nalanda apart was the sheer scale and rigour of its academic enterprise. The library complex, known as Dharmaganja – “Mountain of Knowledge” – was spread across three large buildings and was said to house hundreds of thousands of manuscripts. Nalanda hosted ten thousand students at its peak, drawn from China, Korea, Tibet, Sri Lanka, and Southeast Asia. It had strict entrance examinations – most applicants were turned away – but those who entered paid nothing. The institution was funded by the patronage of the Gupta and Pala kings and by the donations of merchants and nobles who considered supporting knowledge a religious duty.
Both universities were supported by kings, patrons, and communities – not tuition fees or commercial motives. They served not markets, but knowledge itself.
This is not a detail about the past. It is a statement about values. The people who built Nalanda and Takshashila understood something that Indian education policy in 2025 seems to have forgotten: that the cost of knowledge falling on the learner is the wrong model. That a society which claims to revere learning must, at some level, subsidise it. That the alternative – pricing knowledge by what a family can afford – is not an education system. It is a market. And markets, left unregulated, sort by purchasing power, not by potential.
The Gurukul and What It Actually Promised
The Gurukul system – which preceded, ran parallel to, and in some ways outlasted these great universities – embodied a different principle still.
The Gurukul system was fundamentally egalitarian, focused on offering education based on a student’s capability rather than their social or economic status. Education in the Gurukul was typically free, reflecting the cultural ethos that knowledge should be accessible to all irrespective of background. The famous story of Krishna and Sudama – two boys from completely different economic circumstances studying side by side at the same Gurukul – is not merely a devotional tale. It encodes a social contract: that the pursuit of knowledge should not be conditioned on the depth of a family’s pocket.
Gurukuls taught Sanskrit, grammar, astronomy, mathematics, Ayurveda, philosophy, political science, and even warfare – all within a framework that prioritised character development alongside knowledge. Students were prepared not just for individual success but for their role within family, community, and society at large.
The Guru was compensated through the Dakshina – a gift given by the student upon completion of their education, calibrated to what they could offer. A wealthy student might give gold. A poor student might give their labour, their time, their sincere gratitude. The point was the knowledge itself – not what it could be sold for.
It would be naive to romanticise this too far. Caste structured access to Gurukuls in ways that excluded the most marginalised. Ekalavya’s story exists precisely because the system was never as universal as its principles suggested. Takshashila, for all its openness, still excluded the Chandala community entirely. Nalanda’s admissions were merit-based but effectively filtered by prior education, which favoured the already privileged.
But even with its contradictions, the aspiration was clear: knowledge as a public good. The teacher as a social duty. The student’s economic condition as irrelevant to their right to learn.
That aspiration – imperfectly realised, yes, but genuine in its direction – is precisely what has been abandoned in contemporary India. And the gap between the aspiration and the reality is not small.
The Numbers That Define the Contradiction
Modern India’s relationship with education expenditure tells the story without embellishment.
The education cost index in India grew from approximately 103.6 in early 2013 to over 195 by late 2025 – representing a near-doubling of costs in just over a decade. An 89% surge, increasing not in bursts but persistently, month after month, year after year, with near-total absence of any relief.
Private school fees rise at 8-12% annually. General consumer price inflation runs at 5–6%. Median household income growth has not kept pace with either. The arithmetic of this – sustained over a decade – produces a compounding crisis that the aggregate numbers conceal until you look at what individual families are absorbing.
The Great Indian Wallet Study 2025 reports that parents spend 20-30% of their annual household income on education when all costs – tuition, transport, uniforms, coaching classes, digital tools, and exam fees – are aggregated. For many middle-class families, education has quietly become the single largest line item in the household budget, surpassing even rent or healthcare.
Twenty to thirty per cent of annual income. On education alone.
Against this, what does the state contribute? India’s public education expenditure stands at 4.12% of GDP – below the 6% target the government set for itself in the National Education Policy 2020, and below the spending level of Bhutan, which allocates 7.47% of GDP to education. The parliamentary standing committee on education flagged this shortfall explicitly in 2025. The government’s own policy acknowledges the gap. The gap persists anyway.
The consequence of this mismatch – rising private costs, stagnant public investment – shows up most brutally in dropout rates. Financial constraints, early entry into the workforce, and social pressures continue to impede progression after Grade 10, according to a NITI Aayog report published in May 2026.The secondary school dropout rate, while improving, stands at 8.2% nationally. Over 65.7 lakh children dropped out of school across the last five years. Nearly half of them – 29.8 lakh – were adolescent girls.
These are not statistics about children who were not interested in learning. They are, in very large measure, statistics about children whose families could not sustain the cost.
Recommended Read: Drop-Out Nation: Who Leaves Competitive Exam Preparation and Why
The Specific Cruelty of Rising Costs at the Secondary Level
If there is one place in the education system where the affordability crisis is most acute, it is at the secondary level – Classes 9 and 10 – and the higher secondary transition to Classes 11 and 12.
This is the stage where costs escalate most sharply. Private school fees for Classes 9 and 10 can run to ₹45,000–₹90,000 annually in a mid-range CBSE school in a Tier-1 or Tier-2 city. Reference books multiply. Coaching becomes almost compulsory. The Gross Enrolment Ratio at the higher secondary level stands at just 58.4% nationally – meaning four in ten students who should be in Classes 11 and 12 are not there.
Bihar’s higher secondary GER stands at 38.1%; Meghalaya at 39.7%; Nagaland at 39.8%; Assam at 43.5%. In these states, finishing school is the exception, not the rule. And this is precisely the juncture at which competitive exam preparation begins – the very exams that are supposed to be India’s great meritocratic equaliser.
The logic is circular and self-defeating. India’s competitive exams – NEET, JEE, UPSC – are structured as meritocracies. In principle, a student from any background who masters the syllabus can compete equally with one from the most privileged school. In practice, that student must first survive twelve years of schooling in a system that prices them out at every stage. The dropout at Class 10 never reaches the NEET exam room. The student who reaches it without adequate books, without coaching, without the complete NCERT set, competes at a structural disadvantage that no amount of talent fully compensates for.
A country that genuinely believed in education as a social equaliser would not have designed a system that sorts by economic capacity before the merit test even begins.
The Coaching Economy: When School Isn’t Enough
The proliferation of private coaching in India is, itself, an indictment of the system it runs alongside.
Nearly one in three students in India depend on private coaching alongside school education, according to CMS Education 2025. At the higher secondary level, more than a third of students are enrolled in some coaching class.
This is not a preference. For many students, it is a necessity created by under-resourced schools, large class sizes, and a competitive exam system calibrated to a standard that classroom instruction alone rarely reaches. The coaching industry exists not despite the school system’s failures but because of them.
| State | % students in coaching | Annual coaching spend per student |
| Tripura | 78.6% | ₹12,566 |
| West Bengal | 74.6% | ₹7,878 |
| National average | 27% | ₹2,409 |
| Urban higher secondary | 30.7% | ₹9,950 |
| Rural higher secondary | 25.5% | ₹4,548 |
Source: CMS Education 2025, MoSPI
Indian households now spend an estimated ₹5 lakh crore annually on private education – tuition fees, coaching centre subscriptions, online course payments, and the quiet cash slipped to the neighbourhood tutor every month. That is roughly four times what the government itself spends on education.
Four to one. Private investment to public investment, in a country whose Constitution mandates free and compulsory education for children up to age 14. The gap between constitutional promise and economic reality has widened so far that families have essentially built a shadow education system – at their own expense – to compensate for what the state has not delivered.
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The Gender Equation: Who Gets Left Out First
When money gets tight in an Indian household, the question of which child’s education gets prioritised is rarely made explicitly. It is made structurally, through thousands of small choices that aggregate into a pattern the data makes unmistakable.
Families spend ₹1,804 more per year educating a son than a daughter. In urban areas, the gap is ₹2,791. Rural households spend 18% more on boys than on girls in terms of course fees, textbooks, stationery, uniforms, and transport. By the higher secondary level, families spend 22% more on tuition fees for boys than for girls.
In Delhi, 38.8% of boys attend private schools compared to 26.6% of girls. In Madhya Pradesh, Rajasthan, and Punjab, similar gaps of more than 10 percentage points exist. Girls are more likely to be enrolled in government schools – not because the quality is better, but because the cost is lower.
The practical consequence: girls reach the secondary level with, on average, fewer resources, less coaching support, and less access to the preparation that competitive exams demand. They drop out at higher rates. They reach Class 12 in smaller numbers. They appear for NEET and JEE and UPSC in proportions that do not reflect their actual numbers or capability.
A civilisation that wrote the Devi Mahatmya, that deified Saraswati as the goddess of knowledge, that produced Gargi and Maitreyi as philosophical equals to any man of their era – this civilisation’s contemporary households spend 18-30% less educating their daughters than their sons.
The irony does not require elaboration.
What the State Has – and Has Not – Done
It would be unfair to suggest that the Indian state has been entirely indifferent to this crisis.
The Right to Education Act of 2009 made elementary education a fundamental right and mandated free schooling from Classes 1 to 8. NCERT books are priced at cost – ₹50 to ₹200 per copy – and the government runs large-scale distribution programmes for government school students. The Mid Day Meal scheme addresses nutrition as a driver of attendance. Scholarship programmes exist for SC, ST, OBC, and economically weaker students.
But structural gaps persist. India has over 10 lakh vacant government school teaching positions as of early 2025, contributing to pupil-teacher ratios of up to 47:1 in some states. Only 23.4% of Class 3 students in government schools can read a Class 2-level text, according to ASER 2024. The scholarship system has been plagued by delivery failures – an 89 lakh drop in SC, ST, and OBC scholarship beneficiaries was reported in 2025, attributed to Aadhaar linking issues and administrative delays.
The NEP 2020, India’s most comprehensive education reform in decades, sets a target of 6% of GDP for education spending. The current allocation is 4.12%. The gap between target and reality is not widening – but it is not closing at the pace that the education cost inflation rate demands.
Private schooling, meanwhile, has expanded rapidly to fill the vacuum. Schooling in India is financed overwhelmingly by families across every school type – family funding exceeds 97% for nearly all school type categories. Government scholarships form only a very small share of primary funding.The system that was supposed to be a public good has become, in practice, a private burden.
Read More: Where Are India’s Students Most Book-Deprived? (And What’s Being Done)
The Distance Between Reverence and Reality
India invokes its educational heritage with remarkable frequency and genuine pride. Nalanda is being revived – the new Nalanda University in Bihar opened its doors in 2024. The International Day of Yoga, the Vedic Mathematics movement, the global celebration of India’s intellectual traditions – all of these reflect a civilisation that knows, at some level, what it once was.
What is less frequently reckoned with is the distance between that heritage and the present reality.
The Gurukul asked the student to bring themselves – their commitment, their attention, their willingness to learn. Knowledge was the guru’s gift; the guru’s gift came from a cultural compact that said society would support the transmission of knowledge because knowledge served society.
The 2025 system asks the student to bring their family’s money – a specific sum, on a specific date, in the form of fees, books, transport costs, uniform bills, and coaching payments – before a single lesson begins. And if the family cannot bring that sum, the student does not learn. Not because they are unable. Not because they are unwilling. Because the financial gateway has not been cleared.
That is not reverence for education. It is commerce wearing reverence’s clothing.
What Can Actually Change – Right Now
Systemic change in Indian education takes decades. Fee regulation, public spending increases, teacher recruitment at scale, infrastructure improvement in rural schools – these are legitimate goals, but they move slowly, through policy cycles and political negotiations and budget constraints.
What does not require a policy cycle is the second-hand book economy.
Textbooks in India represent a peculiar inefficiency: they are produced at significant cost, used intensively for one academic year, and then discarded – even though they contain the same knowledge as the year before, the year after, and every year in between. The NCERT Biology book that helped your child understand cell division is the same book that will help the next child understand it. The Physics textbook that carried a student through JEE preparation is functionally identical to the one the student after them needs. The waste is not in the content. It is in the distribution model.
A family spending ₹15,000 on books for two children this June could spend ₹5,500 to ₹7,000 sourcing the same books through a well-organised second-hand platform. That saving of ₹7,000 to ₹9,500 is not a rounding error for a household spending 20% of its income on education. It is a month of a child’s coaching fees. It is several months of transport costs. It is real.
Aggregated across India’s tens of millions of private school families, a functioning circular book economy represents thousands of crore in annual household savings – at zero cost to the government, with no policy change required, and no waiting for the next budget cycle.
This is what BookMandee is building – not as a consolation prize for a system that hasn’t worked, but as the infrastructure that should already exist in a country that claims to revere learning. Every book that moves from one student’s finished year into another student’s beginning is a small restoration of the original compact: knowledge should flow toward those who seek it, not stop at the point where their money runs out.
Recommended Read: Dear India, Your Kids Deserve Books. Not Debt.
Frequently Asked Questions
Did ancient Indian education really have no fees?
In principle, yes. Both the Gurukul system and the great universities like Nalanda and Takshashila were free to qualifying students. The Gurukul’s Dakshina was a voluntary gift given after education was complete – calibrated to the student’s means, never a precondition for learning. Nalanda was funded by royal patronage and merchant donations. The explicit principle was that knowledge is a public good, not a commodity. This did not mean access was universal – caste and social structures created significant exclusions – but the financial model was fundamentally non-extractive.
What is India’s current public education spending as a percentage of GDP?
4.12% of GDP as of 2026, the most recent official figure. The National Education Policy 2020 sets a target of 6% of GDP. The parliamentary standing committee on education flagged this shortfall in 2025. For context, Bhutan – a far smaller and less wealthy country – allocates 7.47% of GDP to education. The UNESCO-recommended benchmark for developing nations is 4-6%.
Why are secondary school dropout rates so high in India despite compulsory education laws?
The RTE Act mandates free and compulsory education only up to Class 8. After that, families must absorb the full cost of schooling. Secondary school (Classes 9-10) is the point where private school fees escalate most sharply, coaching becomes expected, and book costs increase significantly. Financial constraints are explicitly cited by NITI Aayog and UDISE+ reports as a primary driver of dropout at this stage. The secondary dropout rate stands at 8.2% nationally, with significantly higher rates in states like Bihar, Meghalaya, and Assam.
How much do Indian families actually spend on education?
The CMS Education 2025 survey – covering 52,085 households – found the national average school expenditure is ₹12,616 per student per year. Private school families spend ₹25,002. When all education costs including coaching and private tuition are added, families spend an estimated 20-30% of annual household income on education. Collectively, Indian households spend approximately ₹5 lakh crore annually on private education – four times the government’s own education budget.
Why does India have such a large coaching industry?
The coaching industry is a direct response to the gap between what school education delivers and what competitive exams demand. As government school quality has remained uneven and class sizes have stayed large, private coaching has filled the space – at a cost that families absorb privately. 27% of Indian students attend coaching classes, rising to over 30% in urban areas and over 78% in states like Tripura. The coaching sector is estimated at ₹5 lakh crore annually, making it one of the largest private education markets in the world.
What is the gender gap in education spending in India?
According to CMS Education 2025, families spend ₹1,804 more annually per boy than per girl. In urban areas this rises to ₹2,791. Boys are more likely to be enrolled in private schools and private coaching. At the higher secondary level, tuition expenditure is 22% higher for boys than girls. In extreme cases – Tamil Nadu, for example – the gap reaches nearly double: ₹35,973 for boys versus ₹19,412 for girls at higher secondary level.
How does a circular book economy help address this crisis?
It does not solve the structural problem of under-investment in public education. But it reduces, immediately and meaningfully, one of the most visible and recurring costs that private school families face. Books bought second-hand cost 40–65% less than new. A family saving ₹7,000 to ₹9,500 annually on books for two children is a family with more capacity for coaching, transport, or simply other household needs. At scale, across millions of families, that redistribution of cost is not trivial. It is the difference, for families at the margin, between keeping a child in school and not.
The Question India Needs to Ask Itself
The contradiction at the heart of Indian education is not hard to see. It is simply rarely stated plainly.
A country that names universities after Nalanda, that invokes the Gurukul as an educational ideal, that decorates government buildings with the image of Saraswati, that tells its children in every possible way that knowledge is the highest pursuit – this country has constructed a system where that pursuit is conditional on what your family can pay.
Children are dropping out at the secondary level not because they do not want to learn. They are dropping out because the financial gateway is real and the safety net is thin. Girls are receiving less education than boys not because they are less capable. They are receiving less because families with constrained budgets have been left to make choices that no family should have to make.
None of this is inevitable. It is designed. And designs can be changed.
The large changes – public spending, fee regulation, teacher recruitment, infrastructure – require political will and time. But there are small changes available today that cost nothing to make and save something real for real families. Using second-hand books is one of them. Listing finished books instead of sending them to the raddi is one of them. Building the infrastructure that makes these choices easy and trusted is one of them.
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