Edu-leaders

Around 6th Century BC, when Nalanda flourished as the world’s first residential university, it was a time of borderless education. Students from all over the globe came to study at a classroom called India. Circa 2010. Higher education has become borderless again. The difference—instead of the world coming to India to learn, about 160,000 Indian students travel to foreign shores every year. Several stay permanently.India’s education minister Kapil Sibal hopes to plug this brain drain by pushing through the long-delayed Foreign Education Institutions (FEI) Bill, which will allow universities around the globe to set up branch campuses in India. In one fell stroke, he hopes that the FEI Bill will succeed in addressing five important issues that are plaguing higher education here—access and equity, relevance, quality and excellence, governance and management, and funding. Concurrently, the Bill also aims to introduce rules and accountability in a hitherto unregulated environment, where foreign institutes have managed to sneak in despite India’s closed-door education policies.

According to estimates, at least 130 foreign providers have forged partnerships with unaccredited, private institutions. But, will the Bill really succeed, given that its drafting process has been plagued with dissension. It continues to flit from one ministerial desk to another in search of a consensus. Critics fear that it is an empty legislation that will lead to crass commercialisation of education. A few administrators, keen to allow international universities in, have faced stiff opposition from the Left, and from leading academics, who believe that the government would do good by increasing funds to higher education, than call in experts from the overseas. The result is a stalemate.

The Compulsions
That we need a policy on foreign universities is not disputed, rather the dissent is about the policy contents. So, let’s look at some of the motivations behind the drafting of the Bill.

Global trade in higher education is already large; it is estimated to account for $30 billion each year. Projections from the Observatory on Borderless Higher Education indicate that of the 165 million people seeking higher education in 2020, about 60 percent will come from India and China. Not surprisingly, the biggest educational exporters today—the US, the UK, Australia, Canada and New Zealand—are keenly eyeing the two nations.

While China opened its bamboo curtains to international universities in 2003, India, despite pressure from the WTO and the General Agreement on Trade in Services (GATS), has resisted, so far. Yet, scores of foreign universities are already present in the country having entered through indirect routes and collaborations with private players.

According to Sudhanshu Bhushan, the senior fellow and head of the higher education unit of the National Institute of Educational Planning and Administration (NIEPA), there are nearly 150 institutions in India that have some kind of foreign collaboration. Many of them offer foreign degrees through twinning arrangements or dual-degree programmes. Twinning arrangements are a popular form of partnership because they involve the least risk and most income, as partners share tuition revenue for a part of the programme taught in the host county, but the foreign institution gets to keep the students’ fees, once they transfer. (See story: The Foreign Hand)

However, most of these collaborations have been dubbed illegal by the All India Council for Technical Education (AICTE) and have earned the wrath of bodies like the University Grants Commission. But, as educational consultant and former IIT Delhi professor Shashi Gulhati points out, the market (in this case students as well as prospective employers) does not seem to care about legality. Not only are students willing to pay fat fees to get into institutions, employers are also happy disbursing premium salaries to students. Placement is not an issue. “The government does not recognise many collaborative programmes. Quite frankly, how many of the students are interested in joining the government?” asks Gulhati.

There is also the issue of the current capacity crisis. According to the National Knowledge Commission, there is a shortfall of at least 1,000 higher education institutions in the country today. Aware that the government doesn’t have the funds to meet this shortfall, experts believe that capacity addition, with a little help from foreign investments, should be allowed.

The third factor is that the entry of foreign universities may help lift quality and standards. Ask the students enrolled at the Goenka World Institute or Modi Apollo International Institute (MAII) why they joined these institutions, and the answer is that the curricula offered by institutions with foreign collaboration are more practical, market-oriented and flexible. The job prospects are also better.

Thus, with increased competition, Indian institutions may also start offering more relevant curricula. The fourth professed reason is to stop brain drain and reduce foreign exchange outflow—though Delhi University (DU) professor and author of a paper Commercialisation of Higher Education in India, Dr Vijender Sharma notes that this is not a sound argument. Every year 160,000 students may be leaving the country for higher education, but this number represents a mere 1.3 percent of the total students enrolled in the country. Besides, the outflow—estimated to be in the region of $7 billion—would, in the long run, result in more in-flows for the country, because a majority of Indian students working overseas send generous NRI remittances home.

The fifth reason is to promote research. It’s the desire of mandarins in the education ministry to get research focused institutions into India, hoping that India would have a home grown Nobel Laureate someday. Some suggest that foreign universities be allowed only on a case-by-case basis, and with a to conduct research. In other words, the universities would need to set aside a fixed corpus for research, only then they will be permitted in. Jayshree Chandra, the legal expert at Zeus Partners, hopes, “Vocational education that has remained underdeveloped, will be strengthened, since many foreign countries and their universities focus more on training.”

A Degree of Doubt
While intentions are laudable, there are many in this country who fear that allowing foreign universities in, could open a Pandora’s Box rather than solve the current problems in the education system. In the words of Philip G. Altbach, a professor at Monan University and the director of the Center for International Higher Education at Boston College, USA, who studied the Chinese experience closely, the biggest fear is that if not regulated effectively, the Bill could let in more “pests than guests”. As Dr Asha Gupta, the director at the Directorate of Hindi Medium Implementation at the University of Delhi, in a presentation—Cross Border Higher Education: India’s Response—points out that the Indian middle-class craze for “foreign degrees” remains unabated.

This often results in students not verifying antecedents of the collaborating foreign university. A prime case being the Indian Institute of Planning and Management in Delhi, which has repeatedly come under legal scrutiny for its affiliations with unaccredited B-schools from overseas. Given that so much foreign activity—and much of it clearly dubious—is already happening, there is little choice for government than to introduce regulations. Indeed, the stated objective of the 2007 draft of the Bill was to curb the entry of foreign institutions which may be “resorting to various malpractices to allure and attract students, particularly in smaller cities and towns.”

Bhushan is apprehensive that the new Bill may lead to crass commercialisation of education in India given that overtly for-profit foreign university chains, like Apollo International, are already in the country. And, it is second rung and third rung foreign institutions that are evincing interest in entering India—not the Ivy League.

Agrees Professor Yash Pal, asking, “Have you ever heard of a great foreign university transplanted somewhere else? Just see, only the run-of-the mill universities will come here, if the Act is allowed.” The educational doyen feels that India has enough resources to provide learning on its own steam and foreign universities have no place here.

But those supporting the entry of foreign institutions have a ready counter argument. They cite how India’s blue chip institutions, the IITs and IIMs, were actually created with foreign help. MIT was involved in the creation of IITs and BITS Pilani, while Harvard assisted the birth of the IIMs. The pro-Bill lobby points to Asian countries like Malaysia and Singapore that have successfully attracted the best campuses to their country and demonstrated that foreign-sourced, in-country provision is a more cost-effective method for educating students.

Red Tape Alert
However, one important point is that many of the Asian countries that have secured famous campuses have actually dangled attractive carrots to lure them. Incentives in the form of cheaper land have been offered. In the late 1990s when the Dubai government was wooing foreign educational institutions, it provided single-window clearances.

Given our notorious red tape, can we do that? In India, as legal experts believe, rather than carrots, sticks are being placed in the path of the interested foreign institutions. It’s reported that in the last round of changes in the Bill, the corpus figure that foreign institutions need to set aside as guarantee money has been raised to Rs 500 million (from an earlier Rs 100 million).

Though the PMO’s office is said tohave suggested that exemptions be made in the case of Ivy League institutions, there are many who fear this differential policy is going to cause further heartburn. As Amitabh Jhingan, a partner and a national sector leader (education) at Ernst and Young, points out, it’s not just the corpus fund alone, the capex required to set up a campus will run into millions. “So, more likely than not, foreign universities are going to charge hefty fees, which will be nearly equivalent to the amount paid by a student travelling abroad to study,” he says.

Interestingly, the Indian private institutions, expected to oppose the entry of these foreign universities, have welcomed the move. As Jhingan says, “Consistently, private education players have voiced their happiness at the Bill being passed at forums.” According to him, they are not worried about competition as “their brands are strong enough.”

Besides, many of them would perhaps like to enter into joint ventures with the foreign universities—to bring down costs at both end. Welcoming the opening up, Anand Sudarshan, MD & CEO of Manipal Education, says, “Education cannot be confined by artificial barriers. And fettering it (education) is detrimental to the nation.” He admits that he is in talks with several foreign universities. “We have had interesting conversations with universities, as we wait for the final government norms. There are multiple models that are possible.”

As the private sector remains gung-ho, it is the government universities that are reacting with caution and suspicion. One great fear is that it is their teachers who will migrate.

The Other Side
What do the foreign universities think? How keen are they? Both external affairs minister S.M. Krishna and education minister Kapil Sibal have reiterated at forum after forum that they are being inundated by visits from university presidential delegations. Representatives from Harvard, Yale, Stanford, Carnegie Mellon, Purdue and Imperial College have come on recce trips to India. Some like Georgia Tech and Schulich School of Business at York University have reportedly started to scout for land in Hyderabad and Maharashtra.

The scouting delegations are mainly from the US, the UK, Australia and Canada. The US, in fact, have escalated pressure at the trade-talks level, though the last round of talks at Doha broke down. The US interest in India is not surprising. India has been the United States’ largest source of international students for eight years in a row. Over 100,000 students went from India to the US during this academic year. However, talks with key players eyeing India throws up doubts and questions.

There are trepidations about the bureaucratic red tape and lack of standardisation. Besides, the huge investment required to enter is a deterrent. As an education expert says, “The fact that you need to buy a ticket to enter, and that ticket will cost a lot of money, is a crippling provision.” There are also some grey areas such as the quota issue—though minister Kapil Sibal says that the foreign institutions will not be forced to set aside quotas. This has predictably raised a furore as many feel that domestic universities and foreign universities should be treated on a par, with same rules applying to both.

For now, the foreign players are noncommittal, preferring to wait and watch. Take Bocconi University from Italy, one of the top-ranked institutions of the world, which has tie-ups with institutes like ISB and IIM Ahmedabad. Says Paolo Cancelli, the global alliances manager at international relations of Bocconi, “We are evaluating the new regulations set by the education ministry and will observe how the educationsector develops in the next few years. We envisage closer ties with India in terms of academic collaborations at many levels. “ Reading between the lines, what is evident is that the foreign players are more interested in coming in through collaborations, twinning and similar arrangements, keeping the status quo intact. Feite van Dijk, the senior advisor at BI Norwegian Management School in Oslo, sees the possibility of a dual-degree programme in India in the future. He says, “Our school has existing studentexchange programmes with IMT, Ghaziabad, MDI, Gurgaon, and IIM Calcutta.”

BI’s interest is not surprising. It has done well in China, where it has around 500 students through its partnership with Fudan University in Shanghai. The Oslo-based university has also made it big in former Soviet Union countries, with around 2,000 students in Lithuania. Clearly, this mode pays huge dividends.

But the draft Bill with its stringent regulations makes it mandatory for universities exempted from regulations to reinvest profits into its Indian operation. Observers, however, believe that expected foreign universities to keep all its profit in the host country is excessive. Even for a top institution, the lure of branch campuses, stems from the money. But, some academics remain hopeful.

As Jhingan points out, “Setting up a campus in India allows foreign students to participate in the India story. Living, working and interacting with companies in India and China is a big advantage in any CV in this global economy.” Indeed, the jobs are here, the money is here, and in this globalised world, everybody now wants a cross-cultural work experience and a piece of the Indian market pie. This is what makes education minister Kapil Sibal optimistic about the proposed change. “Let's build India into one such hub of top-class education that the world will want to come here,” he says. But, before the world converges on the Indian campus once more, as it did in case of Nalanda several centuries ago, a few more carrots need to be dangled.