Budget proposes creation of 20 world-class universities

A new scheme to promote 20 universities to become world-class teaching and research institutions – 10 public and 10 private – was announced in India’s budget last Monday, presented by Finance Minister Arun Jaitley. He also announced a new higher education funding agency to leverage public and private funding for university infrastructure.

Although the institutions slated for world-class status have not been identified, Jaitley said in his speech that it “is our commitment to empower higher educational institutions to help them become world-class teaching and research institutions. An enabling regulatory architecture would be provided for 10 public and 10 private institutions,” he said, adding a detailed scheme would be formulated.

Officials said the world-class universities can either be regulated by a new law or in new provision under the University Grants Commission or UGC, the existing regulatory body, in the case of central universities funded by the state.

An attempt by the previous Congress-led United Progressive Alliance government to set up autonomous universities under the Universities for Research and Innovation Bill in 2012 did not make it through parliament.

Dheeraj Sanghi, a professor of computer science at Indraprastha Institute of Information Technology in New Delhi, and former dean at the Indian Institute of Technology, Kanpur, said proposing an enabling regulatory architecture was important because the current architecture “does not support or empower” universities.

“Rather [it] hinders the higher educational institutions from becoming high quality. The institutions in India that provide high-quality education do so not because of regulations, but in spite of them,” he said in an analysis of the budget.

He noted that the UGC and the All India Council for Technical Education, which oversees engineering colleges and management institutions, only specify minimum standards, “which end up becoming maximum standards for many educational institutions to achieve.”

The Human Resource Development Ministry, responsible for higher education, has already announced it is devising a specific higher education ranking for India, expected to be published this year, which could identify institutions that would qualify for funding under the new proposal.

One of those tipped to benefit is Jawaharlal Nehru University in New Delhi, a postgraduate institution and one of the country’s top research institutions. It has recently been embroiled in a political row over 'anti-national' sentiments.

Private universities

Sanghi and others added that inclusion of private universities on equal footing with public universities for world-class status was an important breakthrough and a departure from previous government policies that did not allow private institutions to benefit from government funds.

It’s “a very significant move”, Nandan Nilekani, co-founder of Indian software giant Infosys, told local media. “If India can get direct investments for 10 world-class universities that will be a huge boost because today billions of dollars are being spent by kids going abroad.”

Earlier this year the prime minister’s office had asked the Human Resource Development Ministry to 'fast-track' a plan to set up 10 private autonomous universities for research innovation, which unlike current private universities, would be free of government control and would have their own curriculum. The institutions would have autonomy in hiring staff and faculty.

Private universities are currently only set up under state legislation, with the UGC only recognising some private universities as ‘deemed’ universities.

However, others said the budget announcement was a limited proposal. “This is a welcome step towards empowering select institutions of excellence to compete at the global level,” said Kalpesh Banker of EduShine Advisory Group, an education consultancy in New Delhi, but “an announcement of a capital intensive, long-term plan, on the lines of China’s 985 or Brain Korea 21, would have been more appropriate”.

He was referring to China and Korea’s programmes for flagship internationally minded research universities into which extra funds are being poured over the long term.

Funding agency

Jaitley also announced a new funding agency to finance infrastructure expansion and renovation of government-funded institutions such as the Indian Institutes of Technology or IITs, Indian Institutes of Information Technology or IIITs, National Institutes of Technology and other universities funded by the central government.

“We have decided to set up a higher education funding agency, a not-for-profit organisation that will leverage funds from the market and supplement them with donations and CSR [corporate social responsibility] funds,” Jaitley said in his budget speech. “These funds will be used to finance improvements in infrastructure in our top institutions.”

While the higher education funding agency – which officials said could be set up as a company under the companies act – will start with an initial fund of INR10 trillion (US$147 billion), an equal amount will be raised from five corporate donors to double the size of the fund.

University sources said while there was a dire need for infrastructure funding for institutions, particularly student dormitories, laboratories and other research facilities, it was still unclear what the repayment conditions would be.

Sanghi said education institutions’ access to loans would need to be cheaper than bank loans, or it could push up the tuition fees charged to students.

Sanghi added: “It is extremely important that loans are given only to worthy institutions. This body should not be stuck with bad loans.”

Jaitley announced an increase of 4.8% in the overall budget for education – criticised as representing no increase in real terms from last year.

However, higher education was allocated a larger proportion compared to previous years. Of the INR7.23 trillion (US$106 billion) education budget, some INR2.84 trillion (or US$41 billion) was allocated to higher education, up from INR2.68 trillion last year.