Why private participation in higher education must be incentivised
Private sector participation in higher education must not only be encouraged, but rather be incentivised
The current IIM Bill under consideration by
the government to be passed as an Act of Parliament has as its hallmark
providing autonomy to the Indian Institutes of Management (IIMs) in all aspects
except selection of Directors and Governing Board members. It is reported that
the government’s final view on this was that to meet the objectives of the
IIMs, this Bill needs to be liberal in outlook and a must if the IIMs are to
leapfrog to the next stage.
After this Bill is passed, the IIMs will be
able to grant Master of Business Administration (MBA) and PhD degrees, instead
of Post Graduate Diploma in Management (PGDM) and Fellow certificates,
respectively. This is a wonderful initiative by the government.
In contrast, the non-government institutions
offering PGDM and Fellow certificates are regulated by the All India Council
for Technical Education (AICTE), which, in its 2010 notification, mandated that
for these institutions the fees, curriculum, admissions, etc, will be
decided/approved by the AICTE or a relevant government body. This notification
was challenged collectively by these institutions then and is before the
Supreme Court, awaiting a final decision.
Every year, since then, an extension of status
quo prevailing prior to this 2010 notification of the AICTE is granted by the
Supreme Court for these non-government institutions to commence various
activities for the next academic year.
The first Indian Institute of Technology
(IIT) in India was set up in Kharagpur in 1951, and there are now 16 IITs. The
first IIM was set up in Calcutta (now Kolkata) in 1961, and there are 19 IIMs
in place now. All IITs and IIMs have been set up outside the university system,
with their own Board of Governors (BoG). It is easy to speculate that for these
‘new age’ institutions, the government must have wanted to give them nimbleness
in decision-making as well as independence from over-regulations to be able to
perform as desired. These aspects must not have been considered achievable in
the university system or under AICTE regulations. Therefore, the inability of
the university system in India to foster world-class institutions was
side-stepped.
While the IITs had the authority to grant
degrees, the IIMs could not, since they were registered as societies, and as a
result the IIMs could give only the PGDM, which was given equivalence to an MBA
degree by the Association of Indian Universities (AIU)—surprisingly, a
non-constitutional body. Thus began the way of higher education in India with
three different governing models—the universities under UGC, the IITs through
the IIT Acts, and the IIMs on their own as registered societies. This kind of
multiple academic governance and the associated degree/PGDM granting systems do
not exist anywhere in the developed world.
It must, however, be noted that higher
education is an option to pursue for career growth by an individual, unlike
elementary education that may be considered essential for a decent survival.
The institutions must constantly keep developing and reinventing themselves,
considering sweeping changes in technology and the way technology is being
deployed to harness resources available and people’s capabilities. The role of
regulators becomes crucial and critical in achieving these ends.
One objective way to involve the regulators
to contribute positively could be for them to also ensure a certain percentage
of universities/institutions under their regulation to figure in the top, say,
200 ranks of some noted international rankers.
Regulating education must not be an end in
itself, rather it must have a defined purpose and the performance expected of a
regulator would achieve just that.
To meet the huge demand for education that
India is facing, private sector participation in higher education must not only
be encouraged, but rather be incentivised. It is crucial that the government as
well as private institutions must co-exist. In addition, the government must
consider making regulations based on need and be objective-driven. This means
all higher education institutions in India must have a common regulatory
framework and not be divided on government versus privately-funded
institutions, very much akin to a common corporate law that governs private and
government corporations in India. The government should encourage private
investment in higher education and also recognise the necessity of financial
autonomy for private institutions. Among the many possibilities of
incentivising private funding, if only a tax rebate incentive is given to
private funding for ‘not-for-profit’ education institutions, the government
would be able to mobilise about three times the money it has forgone as tax
revenue, into the education system.
A policy for privately-funded
university/institution with the kind of regulatory freedom similar to that
enjoyed by the IITs and the IIMs has the potential to produce dozens, if not
scores, of world-class universities/institutions in just 10 years. A
comparative data on public and private universities in the US would be an
eye-opener. Such a policy framework is not yet even in a discussion mode.
Regards
Pralhad Jadhav
Senior Manager @ Library
Khaitan & Co
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