Entry of Foreign Universities

Turning the entry of foreign universities into an opportunity

Roopen Roy

On June 24, 2009 the Committee to Advise on Renovation and Rejuvenation of Higher Education (a.k.a. Yash Pal Committee) submitted its 94 page report to the the HRD Minister Shri Kapil Sibal. It prescribed caution about the entry of "foreign universities" with poor reputation.The fear: they would only create profits for their foreign stakeholders.

I think the nationality of the stakeholders is a bit of a red herring. A distinction that needs to be made is not between "foreign" universities and "domestic" ones but between "poor" institutions of learning and fine institutions regardless of their country of origin.

The Committee itself has acknowledged that the loophole in the existing system “has been exploited by many investors, who have no understanding or experience of the responsibilities associated with institutions of higher education. The trusts or societies that have been formed largely consist of immediate family members –some of whom had little or no educational background - with some exceptions."

Therefore, admittedly there is something rotten in at least several of our private institutions. Instead of plugging the loopholes, we are shuddering in horror that poor quality foreign universities will play havoc.If they succeed in doing so, they will need to be partners-in-crime with the same well-connected Indian “investors” who today manage the system.

The Committee has raised a red alert:

" Specific studies need to be done regarding the sources of funds utilized by such family trusts or societies as there are allegation that such funds are either unaccounted wealth from business and political enterprises (occasionally with some bank loans for purposes of legitimacy) or from the capitation fees charged from the students in addition to a plethora of unexplained fees charged whimsically by these managements."

Dr Kaushik Basu, then in Cornell University and now the Chief Economic Adviser to the Government of India wrote a dissenting note. I will highlight two of his recommendations . Put an end, he said, to the License /Inspector Raj in Higher Education. To quote him,,"Just as India gave up on industrial licensing in the early nineties (and thereby unleashed growth), the reformed UGC and AICTE should give up on the licensing of higher education. Poorly-performing colleges and educational institutes, if information about their performance is made easily available, will be competed out of existence by the pressures of the market."

He also suggested that we punish dishonest, domestic players within the system, " Many private colleges levy charges midway through the course of study by when the student has no choice but to pay up; they advertise achievements of the college which are false; they promise to offer courses without any intention to actually do so. These need to be severely punished."

The Committee, which was set up by Arjun Singh, votes in favour of entry of excellent foreign institutions of learning but with a number of cautionary caveats, "If the best of foreign universities, say amongst the top 200 in the world, want to come here and work, they should be welcomed. Any decision in this regard has to be taken with utmost care. Such institutions should give an Indian Degree and be subject to all rules and regulations that would apply to any Indian University."

Last year Shri Kapil Sibal invited some well-known US universities to enter and invest in India. A liberalized version of the Foreign Universities Bill has been drafted to encourage entry. Reportedly prompted by the Prime Minister’s Office, the latest version of the Foreign Educational Institutions (Regulation of Entry and Operation) Bill, has been finalized by a Committee of Secretaries (CoS). The Cabinet will soon consider it before it is tabled in the Parliament.

There are a few recommendations that I have :

1.We should ensure that only institutions of learning with reputation and eminence are allowed entry.In particular,care must be taken to ensure that shady universities with foreign “brands” should not be allowed to come in holding the hands of dishonest Indian partners

2.Twinning should be encouraged and expanded. A student could spend part of the time in India and part of the time abroad and should be permitted to earn the degree of the foreign university

3. One of the major benefits of studying in a US campus is the international composition of its students and the global nature of the learning experience. India should allow admission of foreign students

4. We must make every effort to attract international faculty and our efforts should not be limited to luring back NRIs only

5.No foreign university of repute will come to India simply to make money. The fees in India are unlikely to be significantly more than a third of what they charge at home. With that income baseline, they will not produce huge surpluses unless they “outsource” or use predominantly local faculty.Again, they will have to bring in some of their core faculty from home base if they are to protect their global brand. They primarily look at India as a happening place.Leveraging our awesome pool of talent is an attraction.Therefore, research activities in India must be encouraged and incented.

6. Finally, the best universities in the world will not be in a hurry to set up full-fledged campuses tomorrow. They will test the water through collaborative ventures, student and faculty exchanges, executive education, joint research projects and curriculum/ courseware sharing before they take the plunge.Any of these collaboration initiatives will be a step forward .

India has the potential and should pursue the vision of becoming a major global hub for higher education in this century. Let us turn this seeming threat into an opportunity by doing it right.