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Saturday, February 7, 2004

Parenting young adults should rank as one of the most difficult jobs in the world.  The parents are obviously concerned about the welfare of their children. So they typically feel the need for more parenting. But, their children want even less.  To paraphrase the famous ‘Coffee Bite’ TV ad: the argument continues…

This ‘family drama’ was recently enacted, though on a much bigger scale, between the Ministry of the Human Resources Development (HRD) and her ‘children’, the prestigious Indian Institutes of Management (IIMs).  Since Independence, these institutes have established themselves as world-famous centers for learning in the fields of business and management. This achievement was possible due to sustained financial support from the successive Ministries of HRD and genuine autonomy.

And now, about a month ago, the HRD Cabinet Minister strongly criticized the IIMs for ‘keeping their tuition fees too high.’  Despite wide-spread opposition from the IIM functionaries, the Ministry wants bring down the tuition fee from the current 1.5 - 2 lakh rupees per year to about 20,000 rupees or even less (based on a suggestion made by the UR Rao Committee for Revitalizing Technical Education), linked to the average per capita income of Indians. The move is apparently towards making higher education more accessible and affordable to deserving candidates from disadvantaged backgrounds. The intent is admirable but there is a problem with the implementation.  Following this line of thinking, in order to maximize the number of incoming poor students, the tuition fees must correspondingly be kept as low as possible.  Such an across-the-board subsidization of highly specialized post-graduate programmes at the IIMs is simply unnecessary and quite untenable.

There is a better, more sustainable alternative:  we can increase the number of sponsored scholarships, tuition waivers and low-interest loans so that poor candidates need not forgo a chance to study at the IIMs.  Even now, most IIM students do not come from rich families – they finance their education though some student assistance schemes (low-interest bank loans, typically).  Given the excellent job placement record of IIM graduates, repayment of these loans has never been a problem to all parties concerned.  Instead of the government money (i.e. your and my hard-earned money) paying for all students, we need to build upon and improve the system of easy financing for eligible candidates.  In this respect, India’s post-independent political economy has taught us a valuable lesson: there is no need to subsidize every student only to subsidize some deserving poor.

This controversy should help focus our attention on three more substantial issues:

First, there are scores of universities and public institutions, other than the IIMs, that offer management degrees.  Most of them exist as mere factories producing graduates on a mass-scale. Consequently, their management graduates do not meet even the minimum of international standards.   Instead of trying to increase political control over the functioning of the IIMs, our government should invest their precious resources on bring these ‘lesser’ institutions up to the par.

Second, India’s public spending on education is already too little - only 3.2 percent of the GDP.  Given the depressingly low literacy rate among Indians, the government should try to bring this figure closer to around 5 percent. On top of that, recent reports indicated that the HRD Ministry requested for an outlay of 32,000 crore rupees in the 2004 budget, while the Union Government would have allotted only around 17,000 crore rupees.  In this light, the Ministry might probably do greater service by focusing their precious resources and efforts on primary and secondary education.

And the third: fathering the IIMs has been a proud achievement of the Indian Government.  Since their birth, these institutes have grown and matured into some of the finest business and management education centers in the world.  All this has been made possible thanks to the benign support and encouragement from successive Indian governments.  Now, these fine, young centers of excellence do not need more aggressive ‘parenting.’ Guidance should not turn into interference.  Why?

Sometimes, the children know better!

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