Regional providers eye Indonesia’s growing student population

Anticipating a dramatic increase in Indonesia’s student population, the national government has moved to reform its education sector. Meanwhile, regional education providers are stepping up their efforts to attract Indonesian students.

According to a recent study by the British Council, the next decade will welcome a mighty 2.6 million Indonesian students into higher education. By 2035, Indonesian post-secondary students can even expect to make the worldwide top 10 in terms of sheer numbers.

The British Council study bases its conclusions on two key factors: demographic and economic growth.

Close to a third of the Indonesian population – the fourth largest in the world – is under 15 years old; and since 1998, the Indonesian economy has expanded by leaps and bounds, achieving an impressive 6.5% growth in the last two years alone, beating out even formidable India.

The fact that Indonesia belongs to the developing world should have a particularly powerful influence on higher education student growth: for developing countries such as Indonesia, experience has shown that gains in per capita GDP correlate to a disproportionately large increase in HE enrolment.

But whether the growing number of Indonesians seeking higher education will produce an equivalent rise in domestic enrolments is another question.

According to the authors of the study, an effective translation of greater student numbers into higher education enrolments will depend on the country’s political and popular will to prepare the tertiary sector for this development. In particular, the authors emphasise the importance of sustained financial investment and commitment to educational reform – necessary to attract and accommodate the growing number of students.

Early attempts at higher education reform

Will Indonesia manage to create the conditions necessary to accommodate a significant rise in domestic demand for higher education? So far, the evidence seems inconclusive.

With respect to funding, the Indonesian education system already receives more state budgetary money than any other sector, and will receive an additional 6.7% in funding in 2013 (for a total of US $34.9 billion); however, most of these funds seem earmarked for primary and secondary education. And compared to regional rivals, Indonesia allocates a miniscule proportion of GDP to R&D.

Reform of the higher education sector does appear to have taken a major step forward with the passing of a controversial higher education bill. According to one member of parliament, the bill is intended to render Indonesian post-secondary education “more modern and globally competitive.”

The bill grants state post-secondary institutions limited freedom to manage their affairs and obtain funding; it allocates 20% of seats at state universities to poor students; and it makes provisions for the presence of foreign universities in Indonesia – favouring those institutions that can provide programmes that are too expensive for the Indonesian system to offer on a large-scale.

The bill has passed through parliament, and the government has managed to win over several influential critics; but its survival is by no means assured. Some groups continue to oppose the bill on the grounds that it will lead to exclusionary tuition hikes, while others fear the influence that foreign institutions will gain despite government regulations.

A legal challenge has already begun, and the Supreme Court has announced that it is reviewing the bill carefully – at this point, it is hard to tell whether the bill will go the way of its predecessor, which was annulled by the Supreme Court in 2010.

Clearly, the higher education sector in Indonesia still faces significant hurdles, which will have to be overcome before Indonesia can comfortably face the prospect of increased higher education enrolment. But the greatest challenge to a boom in Indonesia’s higher education industry may lie beyond Indonesia’s shore.

Study abroad temptations

As ICEF Monitor has reported over the last few months, almost every country neighbouring Indonesia has announced bold plans to increase international student enrolment dramatically over the next decades – leading the pack are China, Malaysia, and Singapore.

For aspiring Indonesian undergraduates, but particularly post-graduates, these countries are increasingly attractive destinations:

  • Malaysia, for example, produces 8 times the number of scientific projects that Indonesia does;
  • China produces hundreds of thousands of patent applications on a yearly basis, compared to Indonesia’s single digit thousands;
  • China’s expenditure on R&D, at around 1.7% of GDP, dwarfs Indonesia’s 0.08%.

The attraction exuded by these study destinations is compounded by the frustration that many young Indonesians feel about the weaknesses of the domestic higher education sector. Corruption and cheating are considered widespread; and both institutions and graduates fare poorly in international comparisons, while degrees from foreign universities are considered a mark of distinction.

Already, more than 36,000 Indonesians are enrolled in universities and colleges overseas – primarily in Malaysia (15,000), Singapore (10,000), and Australia (8,000). This group comprises mainly wealthy Indonesians, as well as those who have managed to win rare scholarships, and constitutes only 1% of the total Indonesian student population.

But as rising affluence among Indonesians meets a growing supply of regional education alternatives that are affordable and high-quality, this trend may change quickly.

The opportunities embodied by Indonesian students have not escaped the attention of Indonesia’s neighbours, who have begun to put their ambitions into practice. Thanks to a recent change in Australia’s visa process, Indonesian students now enjoy simplified access to Australian post-graduate programmes.

And in May, Education New Zealand joined a delegation lead by the Prime Minister to raise New Zealand’s profile among Indonesians; Education New Zealand has also commissioned a study to investigate the student market and education business opportunities in Indonesia – the results should be published this November.

To the North, China has begun to offer hundreds of scholarships to Indonesian students, while the number of Indonesians studying at Chinese universities has jumped over the last few years.

In addition, the US – a traditional favourite destination for Indonesian students – has recently opened a brand new cultural centre in the heart of Jakarta, aimed at winning back Indonesian students who are increasingly gravitating toward more affordable regional alternatives.

Editor’s note: In November it was announced that the UK and Indonesia have strengthened their relationship with eight new higher education partnerships and a new UK-Indonesia Scholarship Programme to promote student mobility and the transfer of knowledge between the two countries.

Will the number of Indonesian students seeking a higher education increase? Probably. Will this increased demand produce a large-scale rise in enrolments at Indonesian higher education institutions? It is too early to tell, but chances are that Indonesia will face stiff competition for her best and brightest from her ambitious, innovative neighbours.



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