China's edtech crackdown could benefit India

China wants its online tutoring companies to go non-profit. This drastic move could not only destroy its $100-billion edtech market but also benefit countries like India.
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China has cracked down on online tutoring companies in the country, leaving shares of its edtech majors in freefall on the US and Hong Kong stock exchanges.

In a bunch of new regulations, State Council — China's highest governing body — has mandated after school tutoring companies to go non-profit and banned them from going public or raising foreign capital — a move that could effectively destroy the country's $100 billion edtech industry

This drastic regulatory move is said to be a part of China's larger crackdown on consumer tech companies and also aimed at reducing the learning burden on young students. 

As a result, giant investors like Tiger Global, SoftBank, Temasek, among others, who are deeply entrenched in the Chinese education ecosystem have been left high and dry. 

This could, however, benefit Indian edtech startups. Founders and investors reckon that India is going to be among the beneficiaries of events unfolding in China, at least in the short run. 

A chunk of the VC money earmarked for China could be flowing into Indian edtech startups that are already witnessing post-pandemic tailwinds. Read more.


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