Because English was used by the British to show their superiority and the people who could speak and converse with British were considered to be superior than "normal" non-English speakers. This has continued till today.
Moreover, as Balaji pointed out, many schools (especially Christian schools) punish students for speaking in their native language. They can ask students to not speak to the teacher in English. But, to force students to speak to each other in English is pretty unconstitutional. I think this practice should be abolished and the schools should be punished for following such practices.
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