Foreign Universities in India - Right Thing, Wrong Reasons

India is looking to fast track the legislation to allow Foreign Universities to set up campuses and even operate as For-Profits, Hindu Business Line claims. Indian media could be excitable, and we have seen such stories before, so this should perhaps be taken with a pinch of salt. However, given that this is a story on the Front Page of a respected newspaper, it deserves some commentary.

I noted in this blog earlier that I would be surprised if the Government does anything on the foreign education front. This scepticism was based on observations about the general approach of this government to Higher Education, with its urgency to indianise education and introduce, as much as possible, traditional Indian values into it. While this story only confirms some of the feelers I received earlier from people in the know, the consensus was that the Government would bring some new legislation just after the Budget session, it directly runs counter to the approach of controlling Higher Education, even directing previously autonomous institutions about their curriculum etc. 

This liberal leap, if it at all happens, will be good for Indian Higher Education. It is not that all foreign providers are good, and indeed, most For-Profits are justifiably viewed with suspicion, but the alternative - a badly regulated and protected market where only the corrupt can survive - is doing enormous harm to India's prospects. One would hope that the policy thinking is broader than this story suggests as one can not readily see how the Government could allow Foreign Universities working as For-Profits while barring the domestic players from it. But opening up the opportunity to new players and making it easier to operate would indeed lesser the scope of corruption, increase market competition and improve the educational experience.

However, all of this may still be done for wrong reasons! Prime Minister Modi alluded to the loss of foreign exchange due to students travelling abroad in his campaign trail, and the only reason cited to explain the policy move was the preservation of foreign exchange. The fact that this comes before the sheer educational reason that India needs better and more relevant education highlight the weakness of the policy. The conversation about Higher Education in India is very rarely about Higher Education at all, and this new piece confirms that observation yet again.

This legislation, as and when it happens, will pave the way for Indian institutions to improve their quality and offering quickly, as they will face international competition as well as become attractive investment opportunities globally. Further, this will also introduce the required scale and diversity in Indian Higher Education, and create the scope building the Google or Facebook of Education out of India! This is a point sorely missed by all those Members of Parliament who keeps blocking this bill every time it came up for consideration, fearing that they would lose access to a protected market. They should now see the other side, that this would make Indian Education interesting to foreign investors and they may get an exit out of their own badly run institutions. They should vote affirmative, though this is still the wrong reason why India should allow foreign universities.


VJ said…
There is a saying, “If You Build It, They Will Come.” Perhaps in that spirit, India’s Modi government is considering its own version of a failed attempt by the former government for inviting the foreign universities (FU) to open campuses in India. It is under consideration that FUs will teach their curriculum, offer degrees, hire its own faculty, and may enjoy the “for-profit” status allowing them to repatriate the profits. The big question we must ask, “Will they come?”
Generally a healthy competition is good for the consumers; quality merchandise at competitive prices. Accordingly, the providers of higher education in India will have to shape up or shut down to compete with FUs. That means better quality education, increased capacity to ease the enormous competition for university entrance, and meeting the growing demand for higher education among India’s youth bulge. India also has the potential to become the regional hub for students from the neighboring countries if FUs offered quality education and the “foreign” degree at an affordable cost. More Indian students may be able to fulfill their dreams of a foreign degree. Obviously, the affordability of education by the FUs is an important question.
What would motivate the FUs to come to India? India’s multinationals and industrialists invest and the government sweetens the pot by offering a “for profit” status and also the land, utilities, and other infrastructure. Let us also analyze the affordability; first of all the notion for-profit and affordability are mutually contradictory. Secondly, can FUs offer quality education at a competitive cost similar to India’s private higher education institutions? If so, the FUs have potential to attract students from India’s upper middle class. The other issue of the “for-profit” status for FUs is a dramatic shift in India’s policy. Does India want its higher education driven as a business or education for the greater good of the society?
We all know that quality comes at a cost. The competition between the FUs and India’s institutions of higher education will necessitate quality faculty, better infrastructure, improved teaching tools, and significant technology enhancements. Should FUs come to India the market forces are likely to lure the best faculty from India’s longstanding institutions to the FUs? This will make things worse for these institutions who are already resource poor and facing faculty shortage. This can erode their reputation over time driving better students away to the FUs. Is India willing and ready for the unintended domino effect leading to the diminished prestige of its best institutions?
I am all for globalization and the thought of FU’s in India appears very attractive proposal at first. However, I am not sure how many FUs will be knocking on India’s doors even if they were offered a red carpet welcome. Similar attempts have failed once before and I can’t imagine any U.S. university, public or private, ready to jump in the fray now? Why? Because India has not yet demonstrated that its regulatory practices are adequately reformed to do business globally. India must first take charge of its current issues in higher education such as faculty shortage, unauthorized universities offering degrees, institutions running without proper facilities, lack of accredited universities/colleges, and even its apex body, the University Grants Commission, being dysfunctional. It should first create a culture of rewarding and incentivizing the “non-profit” private institutions, currently operating in India, for offering quality education at an affordable cost. In my view it is premature for India’s policymakers to invite the FUs with “for profit” status; India stands to lose more than it may gain from a slight increase in its capacity by adding a few more FUs. The whole notion of “for-profit” FUs is a bad public policy and contrary to education for the greater good.

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