Foreign Universities in India

Kapil Sibal is in full swing and he has cleared the draft of Foreign Education Providers (Regulation) Bill to be placed before the Union Cabinet. Once the cabinet clears it, the Foreign Education providers will be able to offer degree programmes independently in India. This, in Mr. Sibal's view, will save millions of dollars as Indian students will be able to study in foreign universities while staying in India. This will also expand the Higher Education offering in India, which will supplement Government's efforts to ramp up the number of seats and the quality of learning.

This news was received well in India. This was always on the cards, but the previous drafts of the bill never saw light of the day because the previous education minister, Mr Arjun Singh, was never very keen on getting the foreign universities in. Instead, he allowed a corrupt License Raj to foster in Education, leading to rapid deterioration of quality of Higher Education in India.

The current Minister is keen to change things fast. He knows he can make an impact and leave a legacy, and is keen to do so. However, it may be worthwhile to reflect on the impact of this bill and see how this can change the education landscape in India.

First, we must remember that foreign education providers can, and do, operate in India already. It is possible to have a 100% foreign owned education institute in India. Besides, as many as 150 foreign universities already offer degree programmes in partnership with Indian institutes, where the students study part of the programme in India.

What this bill will change is this: It will allow foreign providers to set up Independent colleges which will be treated as deemed universities, offering independent degrees without having to seek affiliation from an Indian university or tying up with one in partnership. These colleges will then be under the UGC supervision, going through some sort of accreditation process and regular reviews.

Such a move will be fraught with dangers and Mr. Sibal must be well aware of this. The problem in India is not in the provision of education but in the regulatory framework, and this bill does nothing to change that. We shall hope that some change will be forthcoming, given that the AICTE has recently been busted and government has shown intent to crack down on corruption in education licensing. The problem is that allowing foreign universities is a two-way sword, and if it is not regulated effectively, it will invite in many rogue providers from across the world; on the other hand, if it is regulated too much, the top universities will stay away.

There were rumours about the top universities in the world - including many Ivy League ones and the likes of Oxford and Cambridge - waiting in the wings to set up shop in India. In fact, a Mumbai-based businessman took the pains of taking me to Lavasa to show me the site where Oxford in India will be set up. I don't know how much of this is true, but I do not see an apparent reason why Oxford will be terribly keen to set up a campus away from Oxford [or Cambridge, from Cambridge]. I am not sure Harvard or MIT or Berkley will also want to do this, since they have so far resisted the temptation to open in Europe despite the apparent size of their market here. Besides, I suspect that the whole talk in India about these foreign universities dying to open shop in India comes from an inadequate understanding of how these institutions might operate and how they earn their money. However, I would love to be proved wrong as it would be great to have Oxford in Lavasa, which is a rich men's playground so far and not a seat of learning in any sense.

However, I have no doubt that once this bill is in place, there will be a number of educational institutions which will be set up in India. I guess many middle ranked British and North American Universities will want to have an India campus, given the fact that they are not Harvard or Cambridge and can not attract Indian graduates to come to them by default. I shall also see a number of European ones, which have started teaching in English and will be keen to have Indian students, would want to venture into Indian markets.

All said, though, I am not sure how much money this will save the Indian exchequer, because I would think people will still travel abroad to acquire education - because education is far more than just the degree. The fact that the Minister is citing this as the reason for allowing foreign universities rings an warning bell: this is precisely the wrong reason and goes against the tide of globalization of education. I actually think that Indian campuses of foreign universities will compete with the domestic ones which overcharge, which is not at all a bad thing, and will bring some price rationalization to India's degree bazaar.

Since we don't know the details of the bill, we do not know whether this will make it easier for an Indian institution to work together with foreign institutions. It should, as this will possibly remain the preferred ways of collaborating between universities and institutions of higher learning. Besides, the bill should also find ways of encouraging original research. In fact, research is one area where the foreign universities can make a world of difference to Indian students and there must be ways to encourage some research funds available with these universities to flow into India.

So, overall, many exciting possibilities - but still a future fraught with challenges. India must address its educational challenge soon, and the Minister is showing activism and intent necessary for the job. So, all credits of taking the initiative go to him; we shall wait to see how these changes unfold in reality.


Anonymous said…
Well written. Hits all the major issues. Nevertheless, I don't see first rung universities from the US or UK rushing to set up campuses similar to those in their home country in India. The reasons include:

1. Land acquisition issues--anyone remember Singhur/Nano?

2. Labor issues. If any Indian professors are hired, they will want the same salary as the expats for teaching the same course

3. Sibal is doing pirouettes trying to avoid the quota issue. One day he says foreign universities will be subject to the same laws and the next he says the Bill will be 'silent' on the issue--this creates uncertainty for FEIs.

4. Profit repatriation will be an issue and a trade-off in Parliament for the initial silence on the quota issue

5. The capex costs of setting a campus in India will mean fees pretty close to those abroad especially since endowment money cannot be used to offset costs. This will lead students to question why they should study in India when they can go abroad

6. Going abroad is an education in and of itself. Young Indians prize the opportunity to do so.

In short, very little is going to happen with the exception of continuing professional education needed by working adults who can't quit their job and go abroad to study.

Physical campuses of foreign universities will be few and will not have any significant impact on Sibal's agenda
I quite agree - I don't see foreign universities setting up elaborate campuses in India. Thanks for highlighting the major issues - all, except the profit repatriation, will need some work to mitigate.

I keep hearing about Oxford etc setting up campus, and in fact, someone showed me the site of the [future] Oxford campus in Lavasa! As you can guess, the man involved was a Real Estate deal maker with interests in making my company buy a plot of land.

Though I see some of the middle rung universities and colleges going to India, particularly the for-profit ones. Being in India will give them access to an attractive market and I would presume that they would want to charge their home country fees as far as possible.

Lastly, I obviously do not see this as the solution to our Higher Education constraints. In fact, I feel it is sad that the Indian government is standing at an inflection point in the country's history, a point of time when India is on the verge of reaping its demographic dividend, and expects other people, private entrepreneurs and foreign universities to provide the required high quality education. I hope they will soon realize, through failure as you predict, that there is no alternative to the government engaging itself more actively in education, in primary, secondary and tertiary sectors.
Partha said…
Please also read my article:

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