The Kota System: Rs 600 Crore Coaching Industry

Carrying a 420-page Mathematic textbook, Satvat Jagwani rushed to catch the Shipra Express, the start of a 15-hour journey from his home in Satna, Madhya Pradesh, to his coaching class (also known as ‘cram schools’) in Kota, Rajasthan. He had just finished school for the week and would now be spending the weekend taking mock exams. It was raining when he arrived at Bansal Classes in Kota, the pioneer of the coaching industry in the city. Having secured seats at different Indian Institutes of Technology (IITs) for over 16,000 students so far, Bansal is highly coveted by aspirants. As he walked inside, Jagwani met a group of students waiting in the lobby of its five- acre campus and rushed to introduce himself: “Hi, I am Satvat Jagwani, Bull’s Eye Program, Bansal, Kota Centre.” Two years later, when Jagwani secured the top rank at the 2015 JEE (advanced) paper, which guarantees admission to an IIT of his choice, the suffix would still stay with his name. “There are lakhs of students in Kota and hundreds of coaching institutes. You are the programme and coaching centre you get into; each has its own reputation,” he says. All around him, as far as the eye can see, there hang banners and advertisements for coaching programmes.

Located 250 km south of Jaipur, Kota has been attracting an average of 125,000 outstation students every year since 2003. Jai Bhahadur Lal, an owner of a local mess, recollects a time when Kota was nothing more than a small industrial town. “Coaching was an alien concept ten years ago. There were no hostels or fancy buildings. The town was barren except for a few residential colonies. JK Synthetics was the largest employer here. When it closed down in 1996, many engineers decided to stay on and start tutoring students. Some of them were from the IITs themselves and as their students started to get through the IITs, their popularity grew, and with it, the [local] economy,” says Lal.

One such entrepreneur was VK Bansal, an IIT-Delhi graduate who is diagnosed with muscular dystrophy, a degenerative disease without a cure. He started teaching students in his own dining room. Today, Bansal Classes has 11 centres across the country and has recently started its own engineering college. Following Bansal’s example, RK Verma, an IIT-Madras graduate, set up Resonance. The institute has recently partnered with HCL to set up 100 coaching centres around the country. Then came JC Chaudhry, graduate of BITS- Pilani, who set up Aakash and quickly expanded to own 96 study centres and 125 exam centres around India. K Goel, another IIT-Delhi graduate, started FIITJEE, a powerhouse of coaching that churns out 120,000 IIT aspirants every year through its 40 branches. And suddenly there was no stopping the industry. Allen Career Institute, Brilliant Tutorials, Career Point, Career Launcher, Paradise, IIT-ians Pace—all came up within two years with one single intention: to rope in as many engineering aspirants as they could. “Tutors were always common, but suddenly coaching became an organised, million-dollar industry. These institutes attract students like bees to honey. It has become increasingly difficult to secure a place at a good coaching institute. Just look at the irony at work here. You have to now study for and pass an entrance exam so that you can attend coaching to sit for another exam,” jokes Indranil Manna, director of IIT-Kanpur.

Today there are around 150 functioning coaching institutes in Kota. With an average yearly tuition fee of Rs 1 lakh and additional living fees of roughly the same amount, the coaching industry (even though it is not formally recognised as one) is estimated by the Asian Development Bank at Rs 600 crore with potential to increase at 15 per cent every year. According to the ADB study, ‘Shadow Education: Private Supplementary Tutoring and Its Implications for Policy Makers in Asia’, nearly 82 per cent of students in India juggle regular schooling with additional coaching for competitive exams.

But despite the potential and initial triumphs, things did not look good for both Kota and the coaching industry between 2010 to 2013. Rising student suicides and crime in the city coupled with fierce teacher poaching between rival institutes led to only 8,000 fresh students applying to the city in 2011. “Every industry has a peak stage and a dark stage; the bulls and the bears are inevitable. We faced ours a few years ago when a variety of factors started prompting students to stay in their own cities and enroll at local coaching centres instead,” says Aakash Chaudhry, director of Aakash Educational Services.

And so the industry rolled out a massive revival plan. It started with setting up as many centres outside Kota as possible. The biggest names —FIITJEE, Allen, Bansal, Resonance, Career Launcher, Career Point and Aakash—alone set up as many as 881 external centres between 2012 to 2015. “They had the money to take over coaching in the entire country if they wanted to. But it was used wisely—all external branches fed into the original Kota centre. They marketed Kota as the best centre, with the best teaching facilities, while others were perceived as centres for those who couldn’t make it to Kota. It was like IIT-Delhi versus IIT-Mandi: which would you want to go to?” says Harsh Khangura, a former coaching professor in Delhi. To that effect, the home centre in Kota also saw a huge boost in infrastructure with many setting up five to ten-acre campuses complete with free wi-fi, cheap dhaba comfort food, games rooms, manicured front lawns and ‘chill-out zones’.

Institutes also began to realise that their courses just weren’t fun and attractive enough for a young crowd. So they invested in repackaging programmes that were once known simply as ‘one year’ or ‘two year’. Now the same programmes were sold to students and parents as ‘Little Genie Course for Class VI Students’, ‘Diamond Course for Drop Outs’, ‘iTutor’ and ‘Einstein’s Special Batch’. A special course information page was added on their websites using every marketing manoeuvre in the book. Bansal Classes for example, writes on its website, ‘Bull’s Eye Course: The best brains compete for this legendary two year course’, ‘Acme: If you missed out on Bull’s Eye, don’t lose heart. This course can still help you shape your future.’

Websites were also revamped to include flashy banners highlighting every rank-holding candidate the institute had ever produced. And social media feeds went on overdrive. “They hired their own public relations firms. On Facebook, all coaching institutes put up photos of ceremonies where toppers are awarded by ex-IITians or celebrity chief guests. Basically, students never stood a chance. The institutes promise them success. All you need to do is enrol for a class where they teach you what schools should be teaching you in the first place,” adds Khangura, who left the coaching industry two years ago after he was asked to teach a class for 13-year-olds. “I was asked to teach ‘early bird’ courses to kids who should be experiencing life, not hitting the books all day like donkeys. Parents, of course, were totally on board. It became a matter of pride to tell one another that my son is in Class XI and attends coaching. And the more traction it received, the more courses the industry was ready to launch. I won’t be surprised if something turns up for five-year-olds next. It just became too competitive for my taste.”

Nothing, however, would demonstrate the aggression of the industry more than the dealings with teachers. Annual salary packages for an ex-IITian professor range between Rs 60 lakh and Rs 1 crore. They also include additional perks such as lavish bungalows near the centre, free transport and free coaching for their own children. “Teachers are very important to a coaching institute. Those from a top IIT, can expect a starting salary of atleast Rs 50 lakh. And this can increase nearly 50 per cent every year. If your student tops an exam, then it can even be a 100 per cent bonus,” says RL Trikha, director of FIITJEE Delhi. According to Ahsan Kumar, a freelance tutor and graduate of IIT-Bombay, one can easily find 10-20 staff members earning above Rs 1 crore at a coaching institute. And to ensure that their investment doesn’t go waste, institutes have now starting rolling out contracts which don’t allow their staff to work for a rival company for at least a year after leaving their payrolls. “The higher you earn, the more lawyers they will hire to draft your contract. It’s more feasible to freelance,” says Kumar. “I think it makes much more sense to pay lesser amounts to teachers and hire more numbers. What’s happening now is that a lot of money is going to a handful of professors and as a result faculty-student ratios can stand at 1:200 at some institutes..”

Today, even as student numbers revert to its original 100,000 figure, institutes are still not ready to let their guard down. Some have started distance learning programmes using bespoke apps and YouTube feeds, others now offer coaching in additional subjects such as medicine, law and fashion, and a few have even opened their own colleges. “If you treat it as an industry then there are different market shares to be acquired—students who can come to Kota to study, students who want to study in their hometowns, students who want to study in their own homes, students who don’t want to study engineering and students who don’t want to take competitive exams at all. There is a variety of consumer needs—to be successful, your products should meet them all,” concludes Khangura.

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