Universalization of elementary education cannot be realised without enabling the girl-child to access and retention of schools. Today participation of girls is considerably lower than that of boys and drop-out rates are invariably much higher. Education and economic development are not only interrelated but one precedes the other. Education became an engine searching for economic development. A rupee invested in education of the society leads more returns and production and productivities than a rupee invested in physical assets. The basic problem of most of the underdeveloped countries is not poverty of natural resources but the underdevelopment of their human resources. Hence, their first task must be to build up their human capital through the development of education. India is no exception in this mater. The present work concentrates on economic development of the state of Andhra Pradesh through education.