Education Industry of Pakistan-

General Overview & Current Status with respect

to Porter’s 5 Forces Analysis
 History
• Govt of India Act 1935; the responsibility of education was
placed in the hands of ministers responsible for provincial
legislature.

• Constitution of 1956; required the state to remove illiteracy,

provide free and compulsory primary education with in minimum
possible time.

• Constitution of 1962; moved away from multiple to a centralized

legislature, acknowledging education as a fundamental right
 Overview
• Education in Pakistan is overseen by the Federal Ministry of Education
and the respective provincial governments.

• After the 18th amendment, education pre-dominantly became a

provincial matter.

• The federal government mostly assists in curriculum development,

accreditation and in the financing of research and development.
• Article 25-A of Constitution of Pakistan obligates the state to provide
free and compulsory quality education to children of the age group 5
to 16 years.

• "The State shall provide free and compulsory education to all children
of the age of five to sixteen years in such a manner as may be
determined by law
 Reforms

• Under the constitution of 1973, the following educational policies

were made:

i. No discrimination on the basis of religion, race, caste or creed

ii. Article 25A; right to education (ages 5 to 16)

iii. Make higher and professional education accessible on merit basis

 Reforms
• The 18th amendment, passed by National Assembly in April 2010,
devolved Ministry of Education at federal level and was given to the
provinces which are responsible for;

i. Curriculum
ii. Syllabus
iii. Planning
iv. Policy
v. Centres of excellence
vi. Standards of education
Government’s Regulatory Body
Other relevant bodies
Key Players
International Stakeholders
Ministry of Education
Higher Education Commission, Pakistan Educational
Institutes Regulatory Authority, All Pakistan Private
Schools Association
IBA, NUST, Quaid-e-Azam University, LUMS, Comsats,
Iqra University, Punjab Group of Colleges, Adamjee,
BSS, The City School
UNICEF, UNESCO, USEFP. World Bank
 Criteria of Literacy
“Ability to read and understand simple text in any language from a
newspaper or magazine, write a simple letter and perform basic
mathematical calculation (ie, counting and addition/subtraction)”

• Pakistan has a literacy rate of 62.3%

• Total enrollment: 27.5 million

• Employment Rate: 4.2% (as per PBS)

The education system in Pakistan is generally
divided into six levels

Pre-school Primary Middle

( 3-5 years old) (1-5 class) (class 6-8)

University
(undergraduate Intermediate High
& graduate (11-12 class) (9-10 class)
degrees)
• Female enrollment is comparatively lower, specially in rural areas

• However, 56% of all teachers are women

• The type of market structure is pre-dominantly monopolistic

competition:
i. Large number of sellers
ii. Differentiated products & services
iii. Little barriers to entry
 Categorisation of Industry
Public Sector Private Sector
• Overall market share: 62%
• Overall market share: 38%
• Dominance in primary sector
• Dominance in middle, high
• 89% of degree awarding and and higher secondary sector
informal education institutes

• Only have local board systems • Offer local and international

board systems
• Education expenditure as
percentage of GDP: 2%
 Donor Agencies (% share of all fundings)
• World Bank Group; 31.6%
• United States Agency for International Development; 26.1%
• Asian Development Bank; 9%
• Canadian International Development Agency; 6.5%
• EC; 5.9%
• United Nations Children's Fund (UNICEF); 3.6%
International Comparison

According to the Quality Standard World University Ranking for 2014,

QAU, IST, PIEAS, AKU, NUST, LUMS, CIIT, KU and UET Lahore are ranked
among top 300 universities in Asia.
Interesting
Statistics
Source: finance.gov.pk
Source: ASER
 EDUCATED POPULATION BY LEVEL OF EDUCATION
(In percent)

Diploma/ BA/BSc & MA/MSc &

Administrative Unit Below Primary Primary Middle Matric Inter-mediate Others
Certificate Equivalent Equivalent

Pakistan 18.30 30.14 20.90 17.29 6.56 0.41 4.38 1.58 0.44
Rural 22.57 34.88 20.25 14.71 4.24 0.23 1.96 0.75 0.40
Urban 14.06 25.45 21.54 19.85 8.86 0.58 6.78 2.40 0.48

Khyber Pakhtunkhwa 19.78 29.64 19.94 18.61 6.09 0.40 3.43 1.56 0.54
Rural 22.05 31.50 19.74 17.45 4.94 0.29 2.40 1.12 0.50
Urban 13.82 24.75 20.48 21.64 9.11 0.68 6.12 2.74 0.66

Punjab 19.16 31.73 21.81 16.78 5.63 0.32 3.23 1.07 0.28
Rural 22.92 35.65 21.38 14.07 3.60 0.19 1.51 0.44 0.24
Urban 14.58 26.96 22.33 20.09 8.09 0.48 5.33 1.82 0.32

Sindh 15.56 27.13 19.20 17.84 9.00 0.61 7.43 2.65 0.58
Rural 21.36 36.46 15.19 14.28 6.53 0.34 3.54 1.80 0.51
Urban 13.37 23.61 20.71 19.19 9.93 0.72 8.90 2.97 0.60

Balochistan 19.23 25.91 20.05 18.58 6.48 0.47 4.43 2.37 2.49
Rural 23.00 28.56 19.44 16.94 4.66 0.33 2.67 1.23 3.17
Urban 15.16 23.06 20.72 20.33 8.43 0.62 6.33 3.59 1.76

Islamabad 14.05 22.68 18.91 17.90 9.84 0.69 10.26 5.24 0.41
Rural 22.46 29.96 22.29 15.45 5.30 0.35 2.88 1.10 0.21
Urban 10.70 19.78 17.56 18.88 11.65 0.83 13.21 6.90 0.49

Source: PBS 2017

 SWOT Analysis
Strengths
• Creation of Human Resources
• Skill set with English proficiency and quantitative has
resulted in international acceptance of local students
• Private institutes take part in social activities
• Presence of regulatory bodies
Opportunities
• Increased competition resulting in improved
efficiency and quality of education
• Training programs
• Continued expansion
• Technology development and innovation; distance
learning
Weaknesses
• Lack of strategic planning
• Lack of investment in infrastructure; mismanaged
universities
• Lack of government funding
• Political interference in the university administration
• Lack of well-designed curriculums
• Inadequate collaboration among professional
organisations
• Little scope in extra-curricular activities
Threats
• Focus on profit-making rather than education
• Differentiated quality of education
• Weak legislation; increasing fee
• Increasing number of private institutes

Political
• Government Instability:
Nationalisation VS
Denationalisation
• High level of corruption
• Inability to increase
percentage GDP expenditure
on education
Technological
• Research and development
activity
• Inability to merge technology
with education
PESTEL Analysis
Economical
• Inflation rate: 8.9% (as per
PBS)
• Increasing tuition fee
• Donor agencies
Environmental
• Unavailability of electric
supply; power breakdowns
• Poor health of rural
population; negative effect on
education
• Extreme weather conditions
resulting in closure of
institutes and high
absenteeism
Social
• High population growth rate
• Attitude towards need for
education
• Cultural implications
• Income inequality
Legal
• State responsible for provision
of primary and secondary
education
• Laws against discrimination
• Legal barriers to entry
 Beaconhouse School System
• The school, initially called Les Agnes Montessori Academy,
properly started in 1977

• Currently has institutes to cater to populations of pre-school to

university

• Has dedicated branches for children with special needs

• A parallel school network known as The Educators

23
 Rivals (In Terms of Similarities)
i. The City School (The Educators VS The Smart School)

ii. Foundation Public School

iii. Karachi Grammar School

iv. Mama Parsi School

v. Bai Virbaiji Soparivala Parsi School

 Rivalry

• Due to a large numbers of small to medium sized firms, the

competition is intense

• The fixed costs incurred by all the stated schools is usually high, hence
an often criticized annual increase in fee

• Brand identification is comparatively higher in the private sector.

• Beaconhouse has an IB program and is partnered with BNU, a unique

aspect that its competitors lack
 New Entrants
In order to settle and operate in Pakistan’s education industry,
there are following barriers:

i. Registering Authority (Business Registration)

i. Patented logos, monograms and taglines

i. Brand identification leads to brand loyalty

i. Usually high start-up cost (of a new institution or branch)

 Substitute Products
• The perceived quality of education between BSS, TCS and FPS is
almost similar.

• BVS and Mama Parsi are convent schools that have

comparatively lower fee.
―However, the two schools have limited capacity and very high
enrollment criteria

• Switching costs; admission fees (usually very high)

 Buyer Power

• Parents have little power over suppliers

• Beaconhouse Group has over 300K+ full time students, meaning

that there are a large number of buyers

• Beaconhouse does grant fee concession in the following cases:

i. If a parent is a fulltime teacher at the institute
ii. Excellence in sports (scholarship)
iii. Excellence in academics (scholarship)
 Supplier Power
• The education industry is very vast, specifically the private sector

• BSS has significant power over its buyers as the

parents/guardians find it expensive to switch to an alternative
brand name

• The services provided at the institute are similar to those

provided by its rivals. (except for IB program and BNU)
 Problems of the
Education Sector
Lack of Consideration given to Primary
Education
Poor Monitoring

Poor Infrastructure

Poverty

Poor Quality of Learning

Expensive Private Institutions

Existence of Multifold Educational System

Rotten Curriculum

Other structural issues

Solution/ Recommendations
 Unified, Increase in
thoughtful Fair & Quality Strict & active developmental
National Examination monitoring budget for
Curriculum System teams education

Peaceful and
Honest work &
general
environment
Provision of
Create Ensure
Special Policy basic &
Awareness in Regulation to
Planning Units technologically
order to promote avoid
sound
education exploitation
infrastructure
Thank You