Give student loans on future income: IIT-Delhi

The suggestion is part of IIT-Delhi’s pitch for more financial autonomy for the country’s 23 premier engineering institutes.

The Indian Institute of Technology (IIT) in Delhi has urged the government to emulate Australia and extend income-contingent loans to students to cover tuition fees and seek repayment only after they have found a job.

The suggestion is part of IIT-Delhi’s pitch for more financial autonomy for the country’s 23 premier engineering institutes. The Human Resource Development (HRD) Ministry is currently examining it, The Indian Express has learned.

Australia’s Higher Education Loan Programme (HELP) lends students the cost of their tuition fees, and repayment begins after they start earning above a fixed threshold. HELP is different from mortgage-style loans in which a debtor has to repay regardless of her income.

IIT-Delhi has suggested that the HRD Ministry should consider setting up an agency similar to the Higher Education Financing Agency (HEFA) “for directly funding students with full or partial tuition fee based on their needs and put in a process to recover as additional tax/cess once he/she gets employed.” HEFA is an agency that extends ten-year loans to government educational institutions for infrastructure development.

 

 “It is important for IITs that our graduates do not always choose high-paying jobs but follow their passion in other fields, including research and public service. Very high loan as a burden eliminates career choices as can be seen even today from the IIM type loan based education,” the proposal states.

The IITs spend close to Rs 6 lakh on educating one undergraduate student every year. The student, however, pays only Rs 2 lakh per annum as tuition fee. Moreover, almost half the BTech students at IITs under the SC/ST category are exempt from paying tuition fees. The institutes bear the difference between actual cost and income through their internal accruals and block grants received from the government.

If the government accepts IIT-Delhi’s proposal, the IITs will charge tuition fees based on actual costs and subsequently, become financially autonomous. “The institutes then will no longer depend on government grants,” said an IIT-Delhi official, on the condition of anonymity.

The institute has also suggested a relook at the current postgraduate fee structure. Currently, M.Tech students in IITs are charged a nominal fee and also get assistantship every month. The government, IIT-Delhi has suggested, should encourage IITs to “move M.Techs to either full fee-paying programs (like MBA) or go for industry sponsorship where the costs are paid for by the industry”.

The IITs have been seeking more financial, academic and administrative autonomy ever since the IIMs were granted unprecedented independence under a new Act this year.

As first reported by The Indian Express on February 11, a committee of IIT directors has sought powers similar to the 20 IIMs to appoint their own institute heads and chairpersons. IIT-Delhi’s proposal is in addition to the recommendations of the committee.

Source | https://indianexpress.com/

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