March 2014

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Kota: Where education is an industry

Shops, houses and businesses are scattered across this unique city, yet they are connected by one name—Kota. A city that prepares students for India’s elite tech institutes and operates with industry-like precision.
Kota: Where education is an industry

If you are a student hoping to study at one of the IITs, you might be asking yourself two basic questions. One: “Where in India can you find professional help to crack one of the toughest exams in the world?” Two: “Where can one find the ambience and the environment to crack the exam?” Both questions merit one resounding response: Kota, Rajasthan.

Every year, about 70,000 students stream into the scorched city of Kota—the ‘cram school’ or ‘coaching class capital’ of the country—looking to attend one of its 100-plus such schools. The numbers of students here get chillingly claustrophobic for a small city. After traveling hundreds of miles from Bhopal, Baroda or Bhatinda, you just might find yourself rubbing shoulders with old buddies from your own backyard.

The highly demanding study programs on offer prepare students to achieve their goal: a seat in the IITs. In recent times, Kota has added study lessons to crack medical entrance exams like that of the All India Institute of Medical Sciences (AIIMS) and other universities and colleges. But, it is still the lure of the prestigious engineering colleges that attract students.

Most students have to convince their parents to send them to Kota, but once there, they experience a myriad of emotions. “I had planned to come to Kota after my 10th boards, but could not do so. After failing once at the JEE, I decided to give it all I had, as the number of JEE attempts has decreased to two. I made some enquiries on which coaching classes to attend and the best provisions for accommodation. Finally, I landed up here,” says Ashutosh Sharma of Bhilwara.

In 2008, 8,652 of the 311,258 students who appeared for the IIT entrance exam passed. It is, after all, considered to be one of the most grueling undergraduate entrance exams in the world. But the rigors of these classes are said to prepare students for any eventuality in the entrance exams—and life beyond that, too. Two years of attending classes in Kota, teachers say, is worth a lifetime of knowledge for the students.

The city’s coaching institutes have become an industry of sorts, remarkably molding its entire business pattern according to the needs of the students. Restaurants design their menu with students in mind, while local radio stations advertise coaching classes almost every minute!

Even as the real estate sector was rattled by recent economic strains, Kota’s realty market stood strong. Most constructions taking place here are either owners adding another floor to their houses to rent it out to students, or new houses being built to serve as hostels. Moreover, nearly every household provides accommodation to students.

“The demand for rooms in the city is huge,” says the owner of Eakansh Girls Hostel. “At the moment, our hostel houses 50 girls from all over the country. And there is an ever-increasing demand to accommodate more.” Currently earning about Rs. 3 lakh a month, Eakansh Girls Hostel is in the process of adding another building to cater to the new admission season. A quick tour of the city yielded more then 500 hostels, each earning around Rs. 6,000 a month per student.

With Kota’s reputation for success spreading rapidly, the number of students flocking into the city rises every year. Everyone benefits from the influx, right from the newspaper vendor to the milkman. Hindi newspapers do better business in Kota than the English ones; every student religiously begins his or her day with a quick scan of the paper, but it’s difficult to arrive at the exact number of papers sold in Kota in a day. Kota produces 8,043 kgs of milk a year on an average. This is delivered to students by milkmen sporting bright turbans and handlebar moustaches, driving around the city on motorcycles with shining, copper milk vessels.

Of course, the boom in students has led to a boom in business for the city’s restaurants, too. Restaurateur Nilesh Agarwal says he has changed his service pattern, food and management to suit the needs of the students in Kota. “Students look for fast service and less spicy food,” says Agarwal. “Since our inception in January 2004, I have completely changed my business model [based on their requirements].” Today, Agarwal sees footfalls of around 300-350 a day, a majority being students. With each student spending an average of Rs. 70 per day, he says the response has been far better than expected.

As Kota is just about 310 square kilometers large, much of the commuting happens on two-wheelers. In fact, bicycles far outshine any other mode of transport, as the city’s huge student population prefers them. Says Kundan Lal of Kartik Auto Centre, “On an average, I sell about 200 bicycles a month. The demand is particularly good during the summer months (May-July), when new students come in.” A bicycle costs around Rs. 3,000, which translates into monthly sales of Rs. 60,000 for Lal.

For students, there is nothing much to do here except study. Devoid of any real hangouts, the city doesn’t have much to offer in terms of entertainment. Even multinationals have stayed away from Kota, the fifth biggest city in Rajasthan. Things, however, are changing. Two new malls are coming up in the industrial region of the city, and the world’s largest fastfood chain McDonald’s is all set to make its mark there. Moreover, realty majors like Indiabulls have taken up land beside the busy Kota-Bhopal highway.

So, how did Kota’s cram school phenomenon even begin? It all started in 1981, when an engineer called V.K. Bansal was diagnosed with muscular dystrophy. Desperate to find a source of livelihood, Bansal and his brother founded Bansal Classes. “We were engineers working for industries,” says Pramod Bansal, CEO, Bansal Classes. “Teaching was not exactly in line with our profession. But as we had the background and aptitude it needed, we started Bansal Classes.” The success of Bansal Classes led to the creation of many more coaching classes, many of them started by Bansal’s former employees. In time, hundreds of cram schools proliferated all over the city.

Today, it’s a handful of classes—Bansal, Resonance, Career Point and Allen—that rule the roost. Bansal teaches about 17,000 students every year; about 25 percent of them get through to the IITs. Interestingly, Bansal does not market its services, instead relying on word-of-mouth publicity. It only advertises on two occasions: when the admission dates for the IIT-JEE classes are announced, and when the results of the IIT-JEE entrance exams are declared. In 2007, Bansal Classes opened a new, bigger campus of 10,768 square meters; this had the surprising effect of pushing up realty prices in the area.

In Kota’s Rs. 280-crore cram school industry, specialized teachers do not come cheap. One of the main reasons why the industry has clicked here is because professionals come to the city and take teaching as their primary source of income. Professionalism has entered the system, and the aspect of financial gain has people increasingly looking at these centers for employment. Course fees in Kota can be as high as Rs. 70,000 a year—much of this goes into retaining and attracting quality teachers.

V.K. Bansal, 60, says he is now worth more than $20 million—and the industry he created, along with its ancillary businesses, is worth millions more. However, Kota’s overdependence on just one sector is worrying for a few. Given the cyclical nature of any business, a change in fortune for the cram school industry would mean a huge jolt for those whose livelihoods depend on it.

Czar of Cram School City

V.K. Bansal is credited with triggering the entire coaching class phenomenon in Kota. “It was a need-based profession for me at that time, since the doctors had told me I would not be able to walk for 10 years, due to muscular atrophy. I listed a few professions I could take up, and teaching was the most appealing to me,” says Bansal.

In 1981, Bansal began teaching, starting with one 7th standard student. In five months, he had another student, and the next year he managed to get another. “My aim was to settle down with a salary that matched what I used to draw at J.K. Synthetics,” says Bansal. Taking the advice of people around him, Bansal decided to train students for the IIT-JEE entrance exam, as it was much more lucrative than coaching school students.

One of his students got through to IIT-Roorkie in 1985, and a similar feat was achieved in 1986. Word spread among engineering institute aspirants about a man who could help you crack one of the toughest entrance exams in the world. Soon, Bansal found himself with more students than he could handle. “I had to devise a test to select a few whom I could teach—and we follow that practice even today,” Bansal explains.

Coaching classes have become an industry in the city, but Bansal never dreamed this would happen back when he started out. “People saw it as a lucrative business and developed their businesses around these students. If it wasn’t for the hostels that have sprung up across the city, it would have been impossible for me to teach 17,000-odd students each year.”

Bansal now has enough money to take care of his needs, even if he quits teaching today—but he enjoys teaching too much to do so. Requests to set up similar coaching class centers in Dubai have been pouring in, but Bansal has, so far, refused to expand his business anymore.

©Entrepreneur November 2009

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