Saturday, September 28, 2013

IIM-Ahmedabad petitions government on increasing faculty pay

The country's premier management institutes, led by Indian Institute of Management, Ahmedabad (IIM-A), have petitioned the government for higher compensation for faculty members across IIMs. "It's important to create an international brand through quality faculty and students," said AM Naik, Chairman, Board of Governors (BoGs), IIM-A, at a press meet in Ahmedabad on Saturday.

"You cannot pay them (teachers/faculty) less than the students," added Naik. The issue, he said, would be taken up by a team of 30-40 members for discussion to create a benchmark and constitute a structure that will allow better compensation for the faculties, once a green signal is given in the new parliamentary bill.

Six years ago, the Union Ministry of Human Resources Development (MHRD) came up with Institutes of Management Bill for the country's premier B-schools. The bill, which will bring the IIMs under the purview of Parliament, is expected to be modeled on the Institutes of Technology Act, 1961.

"The quality of faculty has gone down in the past few years and has to be improved" says Naik. "So for improvement we first needed a captain and now as we have Nanda, we hope he would bring in such an improvement" added Naik. Professor Ashish Nanda, an IIM-A 1983 batch alumnus and professor at Harvard Law School, is the newly- appointed Director of IIM-Ahmedabad. He assumed office in the first week of September.

Prof. Nanda's appointed came after an intense hunt for a new director for nearly 10 months after the former director Samir Barura's tenure ended in November 2012. For the first time in its history, IIM-A advertised the post in an international publication seeking a candidate with global exposure.

Supporting Mr Naik's point of view, Prof. Nanda, said top-class faculty was needed for a world-class institute in the country. "If you want good professors, you have to give better packages (salary/compensation)" he said, adding that even after the government has geographically spread IIMs across India bringing the number to 13, things cannot improve unless best quality faculty are brought in. IIM-A intended to bring in the best brains with vast experience from India and abroad, he said.

Mr Naik gives said that on an average, the package received by an IIM-A graduate is about Rs. 1.9 million per annum, while for the top 10 students it ranges between Rs. 6 million and Rs. 10 million per annum. On the other hand, a professor earns Rs. 600,000 to 700,000 per annum. Such a disparity of income, where a teacher enables a student to earn more than his/her own compensation at a fresher stage, discourages the best brains from joining the educational stream, Naik said.

Asked how the IIMs, especially IIM-A would be able to support the higher compensation for their faculty in case the recommendation for higher compensation is accepted, Mr Nanda said the institute would adopt a multi-pronged strategy to raise funds, via student fees, including new programmes, through alumni and donor funds.

Source: The Economic Times (Online Edition), September 28, 2013
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Number of CAT aspirants at seven-year low; MBA degree falls from grace

The number of applicants for CAT (Common Admission Test) 2013 has dipped to a seven year low, indicating that an MBA degree has fallen from grace in the backdrop of a dull economy, escalating costs and uncertain placements. Only around 196.000 vouchers have been sold for this year's common admission test to 13 of the premier Indian Institutes of Management (IIMs) and 120-odd non-IIMs, marking a nearly 33% comedown from a high of 290,000 in 2008.

Till September 26, the last day of online registrations, 196,095 vouchers had been sold, said CAT 2013 convenor Rohit Kapoor of IIM-Indore. Registrations for the test closed at 194,514.

The last time CAT had seen such few takers was in 2006, when some 191,000 students had appeared for the test. Ironically, the lower interest comes at a time when IIMs have added 115 seats, taking the tally across these 13 institutes alone to a total of 3,335. The IIMs and test-conducting firm Prometric had been preparing for more students to appear for CAT 2013 — to be conducted from October 16 to November 11, 2013 — with the test centres spread across 40 cities against 36 last year.

Despite a greater number of seats, interest from candidates seems to be waning, with an MBA degree no longer seen as guaranteeing a good job. "At one time, an MBA was perceived to be the ticket to a good job and a good life," says Amitabh Jhingan, Partner, Transaction Advisory Services and National Sector Leader - Education, E&Y. "That story hasn't played out."

He says that a number of MBA institutes which have sprung up are not providing students any jobs. Some of those have even wound up. "At the top 10-20 institutes though, there is unlikely to be a drop in interest or a lowering in cut-offs," says Jhingan. Agrees Anindya Sen, Dean (Academic) at IIM-Calcutta: "There was a time when it was all about the craze for an MBA degree. Now that is changing."

Students realise, he adds, that other than at a handful of B-schools at the top, the expenses of acquiring a management education are not worth it in terms of the returns. "On the supply side too, a lot of B-schools have closed down. This is a market correction of sorts," he says.

IIM-Indore's Kapoor, who in some reports had been attributed to be expecting voucher sales of 250,000-plus, says: "The decline in registration numbers doesn't bother us because 193,000 is itself a huge number and this time round, we will have more serious and focused candidates sitting for the exam," he says. "The reasons for the decrease in numbers may be varied — the economy, job market and other such issues may have deterred many from applying for the test," said Kapoor.

The MBA boom spawned the rise of a spate of second-rung B-schools. When the market was good and jobs were plentiful, every institute kept increasing its fees. But as economic conditions worsened and so also the job market, placements of students became tough. Despite the schools' inability to place students, they didn't lower their fees.

Saddled with huge batch sizes and a slow job market, even the IIMs faced difficulty in placing the last 5% to 15% of their batches (ET, March 18, 2013). However, in many of the older IIMs' cases, fees have gone up by three to four times from 2007-09 levels when they charged an average of Rs. 400,000. For the Class of 2015, IIM-Lucknow charges around Rs. 108,000 after a fee cut, while at the top end, IIM-Ahmedabad and IIM-Bangalore charge Rs. 1.6 and Rs. 1.7 million, respectively.

One of the main reasons behind dwindling CAT registrations is return on investment. Other options are also proving attractive to students. "Today, if you take GATE (Graduate Aptitude Test in Engineering), you can end up in a public sector company and get a decent starting salary Rs. 1-1.1 million," says Satya Narayanan R., Chairman, Career Launcher. There are students who are reluctant to pay Rs. 1.6-1.7 million for an MBA. They prefer to work for some more time, save up and do an MBA from say an INSEAD, and get paid in dollars, he adds.

Source: The Economic Times, September 28, 2013
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Twinning education pacts get tax relief boost

The Singapore campus of prestigious business school INSEAD has been held not liable to be taxed in India for payments received from an Indian educational outfit. The Authority for Advance Rulings (AAR), in its order — made available on Friday — has held that such payments to INSEAD would fall within the exclusion clause contained in the India-Singapore tax treaty and would thus not be taxable in India. An Article in the treaty covering income from 'fees for technical services' contains the exclusion clause.

Many Indian companies tie up with foreign educational outfits under what is commonly referred to as twinning programmes. Students based in India spend a fixed period overseas and are also provided online training by the foreign educational outfit. On completion of the course, they are awarded a certificate by the overseas outfit.

Eruditus Education, a Chennai-based company, had entered into a similar 'program partnership agreement' with INSEAD. While Eruditus provided marketing and managerial support and facilitated conduct of a 11-month program, INSEAD provided classroom teaching to students at its campuses in Singapore and France, in addition to classroom teaching in India and also teaching via telepresence from Singapore. For such services, Eruditus was to make a payment of 548,000 euros to INSEAD. Eruditus sought an advance ruling on the tax implications of such payments in the hands of INSEAD in India, and also its own withholding tax obligations.

If the payments made by an Indian party to a Singapore resident are treated as 'fees for technical services', such payments would be subject to withholding tax in India at the treaty rate of 10%. In other words, payments would be remitted to the foreign party after deduction of tax in India. However, Article 12 of the India-Singapore tax treaty contains an exclusion clause. Payments made for teaching in or by educational institutions are outside the ambit of 'fees for technical services'. So AAR held payments to INSEAD were not subject to any withholding tax in India.

The AAR also held that as INSEAD did not have a permanent establishment (say a branch) in India, the payments made to it could also not be treated as 'business profits', which are subject to tax in India. "This ruling would have persuasive value in tax assessment of similar cases, where the relevant tax treaty contains an exclusion clause — such as treaties with the UK, the USA and Canada. The exclusion clause would apply to the entire pedagogy of payments such as towards faculty expenses, curriculum, etc," says Sandeep Bhalla, partner, BSR & Co, who represented Eruditus.

Source: The Times of India, September 28, 2013
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Friday, September 27, 2013

Top business schools like IIM-B, IIM-C and FMS add muscle to finance labs

Top business schools like Indian Institute of Management (IIM)-Bangalore, IIM-Calcutta and Faculty of Management Studies (FMS) Delhi are putting in place massive investments for expanding and setting up finance laboratories to aid research, enhance students' proficiency in financial markets and assist them in placements. The finance labs at campuses are equipped with Bloomberg terminals and other national and international databases that provide real-time information on government securities, equity markets and capital structures.

IIM-Bangalore has allocated Rs. 10 million for an extension of its existing facility, which is expected to provide students access to 50 terminals and data from Bloomberg, Newswire 18, CMI, and CRSB early next year. The institute is serious about expanding the existing facility as these databases give students access to large amounts of empirical data for research and projects, says professor Sankarshan Basu, chairperson, career development services at the institute.

"This also benefits students looking at a career in the banking and financial services industry as the companies expect them to be familiar with such databases. Accessing them earlier makes them industry-ready from day one," he adds.

This month, FMS opened its financial laboratory at an investment of Rs. 4 million. It is equipped with 12 Bloomberg terminals. These will help students in improving the standard and level of detail in their final-year dissertations and their term assignments, case studies and research with faculty members, besides assisting them at the time of placements.

"Most finance professionals work on Bloomberg terminals regularly, and being familiar with the scope and operations of such databases will boost a prospective recruits' candidature," says Nitesh Goyal, head of the finance society. Summer placements will begin at FMS next month. About 26% of the class of 210 in the 2012-14 batch found internships in the BFSI sector.

IIM-Calcutta too plans to replace its existing makeshift financial research and trading lab with a 4,000 sq-ft centre which will be accessible to students and faculty members from November this year. "The centre will function like the labs in overseas B-schools, providing students access to live national and international databases, fundamentals and other banking and non-banking data," says professor Ashok Banerjee, Dean of New Initiatives and External Relations.

At XLRI, the primary purpose of putting in place such databases stemmed from placements. "Companies expect students to be familiar with such systems," says HK Pradhan, professor of finance and economics and coordinator of the financial market centre at XLRI.

Source: The Economic Times, September 27, 2013
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In Liberal Arts, Ashoka University to charge Rs. 1.6 million for UG course

Here's a question for India's education-obsessed middle class and upper middle class parents: Would you send your son or daughter to a well-funded, well-appointed, classy private university backed by some of India's best names in business and academia but one that offers a liberal arts education?

No engineering, no job-oriented information technology courses, no medicine or even applied science and commerce. Would bright students opt for English, philosophy, psychology, history, sociology etc, paying Rs. 300,000-400,000 per year for a four-year undergraduate course, even if the university promises world-class teaching and campus environment? The marquee names behind Ashoka University, set to go operational in August 2014, think the answer is yes.

Therefore, a large group of highly successful entrepreneurs has together invested Rs. 1.25 billion to build and run this liberal arts university. The list includes Sanjeev Bikhchandani of naukri.com; Ashish Dhawan, Senior MD, ChrysCapital; Sid Yog, Managing Partner, Xander Group; Puneet Dalmia, MD & CEO, Dalmia Bharat Cement; Pramath Raj Sinha, Founding Dean, Indian School of Business; and Jaithirth Rao, ex-MphasiS head and Chairman of Value and Budget Corporation.

The university will be spread over a 25-acre campus that will offer residential facilities to all students, and is located in the Rajiv Gandhi Education City in Kundli, National Capital Region. It will be run by an academic council that's as blue chip as the list of financiers. Headed by Andre Beteille, professor emeritus, Delhi School of Economics, the council includes, among others, Kaushik Basu, ex-chief economic advisor and now chief economist, World Bank, notable writer/historians Ramachandra Guha, Christophe Jaffrelot and Sunil Khilnani, and Devesh Kapur, who heads the Centre of Advanced Study on India at the University of Pennsylvania. The entrepreneurs and academics are convinced that India needs a centre of excellence that sharpens young Indians' general intellectual ability and helps them broaden their knowledge base.

Stress on Rounded Quality Education
In fact, some of the entrepreneur backers of Ashoka University say recruit-worthy talent needs a rounded quality education, something, they say, is not on offer in India now. Yog, who gifted $11 million to his alma mater Harvard Business School in 2011, got sold on the idea of the university because it was a liberal arts programme. He says a sense of curiosity comes from a good liberal arts education.

"I recruit and it saddens me to see the limited exposure among the students. I am not saying that the functional competence is of no use. What we are trying to do is bring back one of India's biggest strengths - the plurality of India's education. The idea is to build a globally competitive institute with world-class academia," Yog adds.

Guha argues there's a market for quality liberal arts education: "We have a large pool of people seeking quality education. We need a mix of public and private sector endeavours to meet the demand. Having competition will help state universities too." Bikhchandani is even more forthright, saying such a university is a necessity because "the Indian education system is broken..." Our universities," he says, "haven't changed their syllabi in 20 years. The world has changed and we are teaching the same stuff. Our institutions are stagnating."

Dhawan and Beteille accept there are challenges for the new venture. Beteille says Ashoka University will have to overcome the "bias amongst India's intelligentsia that private universities are sinful...that they are only in it for money". Dhawan says branding, marketing and communications will be the key. "You need to convince parents," he says.

Some of this convincing, the university's backers hope, will come from the quality of faculty. Ashoka plans to recruit teaching talent from top US and British universities - professors in Chicago and Oxford have already been headhunted - as well as offer posts to high-quality talent in India. Beteille says many talented professors find India frustrating because of bureaucracy in universities. Ashoka University, he says, will offer an environment suitable for top-quality academic talent.

Guha says the faculty should be largely Indian, whether NRIs coming back or domestic talent. "It shouldn't look like an American university in India," he says. He also said the university must attract students from all over India, not just north India. Ashoka University is also rolling out equivalents of executive education programmes. "We don't know what to call it yet in the context of liberal arts," says Pramath Sinha.

Source: The Economic Times, September 27, 2013
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Thursday, September 26, 2013

UGC notifies twinning norms: Rules for collaboration between Indian, foreign institutes

As top grade foreign educational institutions have shown little or no interest in setting up campuses in India, University Grants Commission (UGC) on Wednesday notified a set of regulations that will allow Indian institutes with grade B accreditation to enter into collaboration with foreign educational institutions.

Incidentally, the notification was published on the day the PM left for the US to attend the UN general Assembly. UGC's notification was necessitated as more and more Indian institutes with B grade accreditation have started collaboration with foreign educational institutions. "The idea is to regulate such arrangements to protect the interest of students. We would not allow dilution of standards," a UGC official said.

Foreign institutions who enter into partnerships should be accredited with the highest grade in their homeland, the UGC notification said. "At the time of agreement for collaboration, Indian educational institution shall have accreditation by National Assessment and Accreditation Council with a grade not less than B or its equivalent grade," the notification said.

Indian educational institutions already having a collaborative arrangement shall comply with these regulations within a period of six months, the notification said. Foreign educational institutions will have to abide by the conditions prescribed by the Indian government from time to time.

Besides, the Indian institutes collaborating with foreign institutes shall have experience of at least five years offering educational programmes at the level of degree and post-graduate diplomas. Violation of rules could lead to termination of the MoU entered into for collaboration and even blacklisting, the notification said.

The regulations are called the UGC (Promotion and Maintenance of Standards of Academic Collaborations between Indian and Foreign Educational Institutes) Regulations, 2012 .

Technical institutes will not come under the purview of the regulations while government institutes shall be exempted from accreditation for the purpose of these regulations. Currently, around 50 foreign institutes are operating in India through twinning arrangement. Twinning programmes not only promise an international degree but also exposure to foreign campuses.

All institutes (Indian and foreign) involved in collaborations shall make public the academic requirements and other details of the programme on websites before commencement of the programme by Indian educational institutes concerned. No programme and research shall be offered which is against national security.

Source: The Times of India, September 26, 2013
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UGC makes public list of fake institutions in India

The University Grants Commission (UGC) has come out with the latest list of fake universities in India. The public notice has been issued in The Times of India of 26 September 2013. The list can also be accessed on UGC website by clicking the following link - http://www.ugc.ac.in/page/Fake-Universities.aspx.
 

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Wednesday, September 25, 2013

Meet IIT-Madras alumnus Prem Watsa, iconic BlackBerry’s new owner

Forty two years after he migrated to Canada, V. Prem Watsa, who was then just another IIT engineer in search of an MBA, now holds the future of an ailing, but still iconic BlackBerry in his hands. On Monday afternoon, a consortium led by Fairfax Financial Holdings, Watsa's flagship company, bid $9 a share to buy out Blackberry.

A 1971 batch IIT-Madras graduate in chemical engineering, Watsa arrived in Canada with little more than pocket change with which to pursue his dreams. He did his MBA from the Richard Ivey School of Business at the University of Western Ontario.

Since then, he has made a name for himself, mostly as an investor who identifies distressed and undervalued assets, bets on them, and reaps returns. Fairfax Financial Holdings, an insurance-cum-investment company that Watsa founded in 1985, went on to become Canada's most profitable company in 2008.

"I know he is an ardent admirer of Warren Buffett and is sometimes referred to as the Warren Buffett of Canada," says MG Venkatesh Mannar, the Ottawa-based President of The Micronutrient Initiative, and Watsa's senior at IIT-Madras. "I remember him then as a shy and reserved person (maybe he still is)."

Funds for Alma Mater
Watsa, Mannar says, has made significant contributions to the IIT-Madras Alumni Fund. Despite a couple of recent lacklustre years, Fairfax Financial Holdings' revenue crossed $8 billion in 2012, up over 7% from a year earlier, with net profit at $532.4 million and nearly $37 billion in assets, spread across pulp mills, specialty retailers, and restaurant chains. Its stock price has compounded at 19 percent annually.

Watsa, 63, and one of the wealthiest individuals in Canada, is reclusive by nature and limits public appearances mostly to Fairfax's annual shareholder meetings. However, his company's latest move - a $4.7 billion bid to buy smartphone maker BlackBerry, has put the spot light on the Hyderabad-born billionaire. BlackBerry is by far the most high profile company in Canada and Fairfax - short for fair, friendly acquisitions - is its largest shareholder with around a 10% stake. Fairfax raised its stake in Blackberry from 2 percent in January 2012 (when he joined the Blackberry board) to 10% by mid-2013, during a period when the company stock prices were on a decline.

Last month, when BlackBerry announced it was exploring options for a sale, Watsa resigned as a director on the Blackberry board, citing potential conflict of interest. This was read as a statement of intent to mount a bid for the company.

Watsa has been a strong believer in BlackBerry from the time he started buying its shares. "The brand name, a security system second to none, a distribution network across 650 telecom carriers worldwide, a 79 million subscriber base, enterprise customers accounting for 90% of the Fortune 500....are all formidable strengths.." he wrote in a letter to Fairfax Financial shareholders this March.

Truck Start
His professional career started in 1974 at the Confederation Life Insurance Co. (CLI) in Toronto, where he stayed till 1983, rising to become the company's vice president. After a short stint at GW Asset Management, he founded his own asset management company - Hamblin Watsa Investment Counsel Ltd. (now wholly owned by Fairfax) - along with his former boss at CLI and three others. In 1985, Watsa bought over Markel Financial, a Canadian company specialising in trucking insurance, and later renamed it Fairfax Financial Holdings.

Watsa's mantra of risk-averseness and long term view has stood him well over the years, but it's his eye for the big picture that enables him to see investment pitfalls and financial crises way before others, say observers. He was among the first to predict the crash of 1987, the Japanese collapse of 1990 and the 2008 sub-prime mortgage crisis in the US.

Source: The Economic Times (Online Edition), September 25, 2013
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Friday, September 20, 2013

For Indian academics, foreign varsities' entry means strong tie-ups, sharper research and best of global faculty

The government's recent move to allow foreign universities to establish campuses in India is seen facilitating collaborative research and opening up the domestic academic environment to the latest pedagogies and curriculum of the West even as global varsities learn more about a major emerging market economy. The move could benefit millions of meritorious students who are rejected from the system due to the lack of seats in colleges. Ivy league institutes, which have ruled out any immediate intention of opening campus here, will continue to enhance their research tie-ups with local institutes and forge new forms of collaborations. Some Tier-2 institutes could also make an entry.

"Existing relationships rely mostly on institutional initiative and faculty-to-faculty collaboration. Having these world-class institutions in India will give a boost to high-quality research being done in the country," says Ajit Rangnekar, Dean, Indian School of Business (ISB), Hyderabad. Once the foreign universities are here, more collaboration will take place on varied fronts and Indian institutions will benefit from some of the modern pedagogic styles of these institutions, he says. Moreover, there will be better opportunities for the Indian talent pool in terms of faculty and educational experts.

Several of India's top management and engineering institutes, including the Indian Institutes of Technology (IITs), Indian Institutes of Management (IIMs) and ISB, already have various tie-ups with global varsities through faculty, student exchange and research. The government's move will further strengthen those associations and lead to exploring new tie-ups.

IIT-Delhi, for the first time ever, is likely to offer a joint degree programme with Toyo University of Japan. The institute currently has research partnerships with Toyo University in bio nano. "Some other universities have also expressed interest and we are trying to look at various ways to collaborate," says Anurag Sharma, Dean-Academics at IIT-Delhi. Research collaboration would be a key area once some of the global institutes register their physical presence here, says Suneet Tuli, Dean, Research and Development at IIT-Delhi.

IIT-Madras, which already has a joint doctoral programme with the National University of Singapore (NUS), is in the process of forming similar associations with University of Passau, Germany, Michigan State University, and NTHU Taiwan. These tie-ups to offer joint doctoral degrees include faculty collaboration, coaching, serving on each others' doctoral committee, etc. The value of co-existence lies more in research and other forms of collaboration, says Prof. R. Nagarajan, Dean - International and Alumni Relations at IIT-Madras.

Last week, the government opened the doors for top foreign universities to set up campuses in India and award degrees, giving Indian students the opportunity to study in global institutions without leaving home or spending a fortune. The move has been welcomed by Indian institutes, academicians, and industry leaders. Among several associations with global institutes, IIT-B and Monash University in Australia have a tie-up in the form of the IITB-Monash Research Academy, where students are doing doctoral research. "IIT-Bombay's associations with international universities are primarily focused on postgraduate education and research. There may not be immediate opportunities for such interactions while these universities are starting up here. However, in the longer-term, we may seek collaborations in areas of mutual interest," says Prof. Devang Khakhar, Director, IIT-Bombay.

The Vice-Chancellor of the University of Cambridge is in India to explore research partnerships with Indian institutes, academia and industry. The university is working with IIT-Bombay, among others in India, in the field of nanoscience and nano-technology. "We are looking for serious partnerships with Indian institutions based on excellence. Our focus will be on research and deep collaboration to jointly tackle some of the world's recent problems," says Prof. Sir Leszek Borysiewicz, Vice-Chancellor, University of Cambridge. This is also an opportunity for top institutes to showcase their research. "IIMs will get the opportunity to showcase their academic professionalism and research," says Prof. S. Raghunath, Dean-Administration, IIM-B.

However, the institutes that are likely to benefit most from global varsities opening campuses in India would be those that do not yet have access to global universities, says IIT-M's Nagarajan. Under the proposed rules of the Ministry of Human Resource Development (MHRD), foreign educational institutions -- before setting up campus in India and being notified as a Foreign Education Provider (FEP) under the Universitiy Grants Commission (UGC) - would be required to maintain a corpus of a minimum of Rs. 25 crore (Rs. 250 million). The rules also provide for penalties ranging from Rs. 5 million to Rs. 10 million for FEPs that contravene any provision of these rules or UGC Act, and the forfeiting of the corpus fund.

But these rules are a cause for some concern. The government must come up with a differentiated policy for top schools in order to attract them here in the interest of long-term collaborative relationships and establishing a technologically-savvy infrastructure, says IIM-B's Raghunath. "Of particular concern is the requirement that all the new institutions must conform to UGC standards. Unless UGC recognises merit and accordingly adjusts its compliance requirements, India runs the risk of alienating high-quality foreign players," says SP Kothari, Deputy Dean, MIT Sloan School of Management.

MIT Sloan School of Management, like other top institutes including Harvard Business School, Stanford Graduate School of Business, Massachusetts Institute of Technology, and Cambridge University have ruled out the possibility of opening campuses here. They are, however, keen to continue engaging with students, academia and industry here through research, faculty exchange, and executive education programmes.

Source: The Economic Times, September 20, 2013
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IIT-Bombay & Australia's Monash University focus on projects relevant to Indian companies like Thermax, P&G & Intel

Late last year, Prime Minister Manmohan Singh announced a major doctoral fellowship scheme - which pays students as much as Rs. 45,000 a month - aimed at fostering relationships between universities and private industry. The first set was awarded last month to 23 PhD students around the country. Six of these students were from a fledgling institution in Mumbai, a Section 25 company called IITB-Monash Research Academy. They are working on cutting-edge projects of interest to companies like Thermax, Piramal Life Sciences, Proctor and Gamble and Intel.

IITB-Monash Research Academy was set up three-and-a-half years ago as a 50:50 partnership between IIT-Bombay and Monash University in Australia. Monash University was the prime mover, led by its dean of engineering Tan Sridhar, one of the most influential academicians in Australia. IITB-Monash Research Academy is expected to work on areas of interest to Indian and Australian companies, bringing a developed country work culture to industryacademia relationships in India. "In the West, universities have a more holistic relationship with industry," says Sridhar. "We want to bring this knowhow into the academy."

The academy has 130 students working towards a PhD, to be increased to 300 students by 2015. About 30% of them are supported by private companies, a figure that is set to touch 70% in the future. According to its officials, the academy students have already published 72 papers in top journals, of which 82% are in the highest-rated ones. Private companies and industrial organisations in India and Australia have together committed to sponsoring well over 100 PhD students over the next four to five years. "Industry-academia partnerships do not work if you leave it to individuals," says Sridhar. "You need an engine room for partnerships."

Right from inception, IITB-Monash had tried unusual methods for an institution based in India. It tried to get the best people at the top. For its research council, it roped in Infosys Co-founder NR Narayana Murthy as the chairman and former Director General of the Council of Scientific & Industrial Research (CSIR), RA Mashelkar, as vice-chairman. Murthy took a serious interest in the working of the research council, and has attended 13 meetings out of a total of 16. The academy signed up several industrial partners, including Infosys, Reliance, TCS and JSW Steel in India. It gave high stipends and considerable freedom to students, with an eye on attracting the best.

It got a well-known academician as CEO: Mohan Krishnamoorthy, who was Associate Dean of Engineering at Monash University. Krishnamoorthy encouraged students to take up challenging problems. "We focus on problems that need to be solved and not on those that can be solved," says Krishnamoorthy. Monash University was used to working regularly across intellectual disciplines and geographical borders, and had a sophisticated way of looking at industrial problems. "The Western research ecosystem is a lot more evolved when compared to India," says Subu Goparaju, head of Infosys Labs and product R&D.

Infosys had been attracted to the concept of a three-way partnership, between a private company, Indian academic institution and an Australian university. "It will help to merge the quality of an international ecosystem with Indian costs," says Goparaju. For the students, the availability of facilities in Monash University is a big attraction, as they spend approximately nine months in the Australian campus near Melbourne, which is equipped with advanced equipment not easily available in India. For example, Indian students almost never get to use the synchrotron, invaluable for studying biological structures, as the country has only one machine in a defence lab. Monash students can use the synchrotron next to its campus.

Private companies normally do not support PhD work in India. In IITB-Monash, Piramal Life Sciences is supporting a student to study biological protein structures, Thermax supports a project to study energy transport in fluids, and Reliance Life Sciences is supporting students to study algae. All of them have important commercial applications.

Access to --- or lack of --- research equipment is a common problem across all institutions in India. In IIT-Bombay, where the academy students work, students have to give an application and wait for weeks. When the permission comes, many facilities are open only from 9 am to 5 pm. Things are much simpler in Australia, where the labs are available 18 hours a day and procedures very streamlined. There are few distractions to work as well. It is no wonder that students and professors accomplish more in overseas campuses.

Source: The Economic Times (Online Edition), September 20, 2013
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Wednesday, September 18, 2013

IITs will take nearly 10 years to get to ideal teacher-student ratio

Facing a severe faculty crunch, the Indian Institutes of Technology (IITs) have projected that it will take the elite institutes close to a decade to get to the ideal teacher-student ratio. The government stipulates IITs must have a teacher-student ratio of 1:10, but at present, the ratio is an area of concern.

Of 6,522 sanctioned faculty positions nationwide, 2,618 are unfilled. Thus, across campuses, there is an approximately 40% shortage of teachers. While student intake has risen by 54% since 2006 in the wake of the 27% OBC quota and the expansion in the number of seats, the teacher-student ratio at campuses is around 1:15. It is the worst at IIT-Roorkee at 1:20 and the best at the newer institutes of IIT-Ropar and IIT-Mandi, where there is one teacher for every two students.

The all-India faculty strength is 3,904 at the moment. "Generally, the older IITs have been picking up about 35 to 40 new teachers annually," said an IIT director. "But student strength has risen rapidly because of the OBC expansion and also as PhD numbers went up. It isn't possible to take faculty numbers up so sharply so quickly. We are going to take five to 10 years to reach the ideal teacher-student ratio," he added.

IIT-Bombay Director Devang Khakhar said faculty quality had got better with time, with most recruits having an overseas PhD. Almost all those who are joining the old IITs have international teaching or working experience, he said.

IITs: We can't compromise on faculty quality
The elite IITs acknowledge a faculty crunch, but insist they will not dilute quality standards. "We cannot and do not want to compromise on the quality of teaching faculty just because we are facing staff shortage. We acknowledge that our existing teachers have been taking the extra burden, but we are constantly looking for good people," said IIT-Roorkee Director Pradipto Banerjee.

Also, the HRD ministry has agreed to create a new cadre of technical staff to man and maintain laboratories at the tech schools. For long, the faculty and the staff shouldered the responsibility of running the labs.

Source: The Economic Times (Online Edition), September 18, 2013
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Tuesday, September 17, 2013

IIM-A and IIM-C post-graduate programmes ranked 18th and 19th worldwide

The Indian Institute of Management, Ahmedabad (IIM-A) and IIM-Calcutta's post-graduate programmes have been ranked among the world's top 20 management programmes in the 2013 FT Masters in Management (MiM) survey.

While IIM-A comes in at the 18th position, IIM-C is right after, in the 19th. Unlike its Ahmedabad counterpart, the Kolkata institute is a new entrant on the list. It also marks the very first time IIM-C participated in the survey.

The 2013 FT Masters in Management (MiM) ranking features the top 70 programmes for students with little or no previous work experience. Globally, the University of St Gallen, Switzerland is at top for the third year running, followed by ESCP Europe and WHU Beisheim in Germany.

IIM-Ahmedabad and IIM-Calcutta are the only two institutes from India to figure in this ranking. Both have been ranked higher than such world-renowned institutions as the London School of Economics, Aalto University, Manchester Business School, among others.

"Our engagement with CEMS, the global alliance in management education, paved the way for our participation in the FT rankings survey, and gave an impetus to our journey for internationalisation. With our accreditation with AACSB expected shortly, and various other initiatives in the areas of internationalisation, entrepreneurship and sustainability taking shape, we are looking forward to performing even better in the coming years," stated an IIM-Calcutta press release.

In the FT Global MBA rankings 2013 earlier this year, IIM-Ahmedabad emerged at No 26, while ISB-Hyderabad stood at 34, both having slipped several notches since the last year.


Source: The Economic Times (Online Edition), September 17, 2013
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ICAA and QS coming up with university rankings for India

Indian Centre for Assessment & Accreditation (ICAA), a private accreditation body, in association with rating agency Quacquarelli Symonds (QS) plans to launch 'Top 100 Indian University Rankings', a first-of-its-kind ranking of Indian universities. The rankings are slated to be rolled out by the next academic year, June-July 2014, according to Arun Nigavekar, Chief Mentor of ICAA.

The objective of the India-specific rankings is to benchmark against the best and to improve quality, and also to let students use data for decisions. "The internal Indian grades are aimed at creating a system which is globally accepted, yet locally grounded," says Nigavekar, former chairperson of UGC and founder director of the National Assessment and Accreditation Council (NAAC).

QS is also working closely with Indian institutions in a pilot ranking project for the BRICS nations, which is due to be launched later this year, says Ben Sowter, head of research at QS. For the past decade, Indian universities have not been ranking high in global ratings, says Nigavekar. The Indian higher education scene spans a huge social spectrum where institutes are at different levels.

"For instance, we have institutes like IITs which have a different scientific, financial and academic environment than say a university college. In between, there will be many levels of spectrum. The rankings will take all this into account," says Nigavekar.

The rankings will act as a one-stop referral for global universities intending to engage and partner with Indian universities, says Karthick Sridhar, one of the founder trustees of the non-profit accreditation initiative. Now that the government has allowed foreign universities to come into India on their own, a benchmark is required for foreign universities to engage in joint initiatives, he says. ICAA plans to work as a bridge between QS and IITs to help enable proper data submission globally.

Source: The Economic Times, September 17, 2013
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Why IITs fared so badly in world university rankings

Days after Indian Institutes of Technology (IITs) failed to make it to the top 200 in the prestigious QS rankings of the world's leading universities, top IIT officials have admitted that it was their indifference to the ranking process and not an intrinsic lack of educational quality that cost them dearly. "We have been complacent. We never really took rankings seriously," Indranil Manna, Director, IIT-Kanpur admitted. "We are doing so now. The government is urging us to be more proactive." Highly placed IIT officials said the Ministry of Human Resources Development (MHRD) has also pulled up the IITs for this.

"IITs are much better than what the rankings suggest, but they are too arrogant to participate and give data," said TV Mohandas Pai, Chairman of Manipal Global Education and former director on Infosys board. He is also the honorary chairman of Indian Centre for Assessment & Accreditation (ICAA), a private accreditation body that is now working on India-specific university rankings.

The QS (Quacquarelli Symonds) rankings are widely recognised as a good measure of the pedigree of universities. Last week, when the MHRD allowed foreign universities to set up campuses here, it ruled that only the other such rankings could do so. Accusing the IITs of living in an ivory tower and not engaging enough, Pai said the institutes owe it to India to give full information, participate in rankings and put out their best. "They need to market themselves," he said.

When the QS ranking process was underway, IITs sent only the names of full-time faculty members who are on their rolls. US universities included research associates, people from industry, part-time faculty — everyone, who has taught even for a short time. This had a bearing on the rankings as faculty-student ratio was given a 20% weightage. So did citations, which contribute 20% of the overall QS score, and is calculated using data from SciVerse Scopus, a database of academic journal articles. Foreign universities put in all possible permutations and combinations of the faculty member/institute's names to facilitate an easier search. Indian institutes were unaware of the need for this.

Similarly, any institute can send names of people associated with it to help QS send questionnaires to the right people. Foreign institutes send 400-500 names; IIT-Kanpur, for instance, sent only 28. Without this QS will survey random people. All this cost IITs dearly in the QS global university rankings released last week. "The rankings are based on two factors: surveys and data," said Devang Khakhar, Director, IIT-Bombay. "(In future) We want to make sure that the correct data is supplied to the ranking agencies." India Inc employers also argue that IITs must take rankings seriously. "We need to ask whether we are living in a cocoon and not wanting to benchmark with others in the world," said Pratik Kumar, President, Wipro Infrastructure Engineering, and Executive VP-HR at Wipro.

"We have sent our IIT recruits to BCG offices across the world, and they haven't just survived, they've more than held their own and succeeded," says Sachin Nandgaonkar, Senior Partner & Director, Boston Consulting Group, who heads the consulting firm's recruitment initiatives. He is an IIT Bombay-IIM Ahmedabad alumnus. "Having said that, given that our output is globally comparable, I'd like IITs to come out strongly in the surveys." IIT-Delhi has kicked into action and put up a plan to avoid a repeat next year. "We have decided to put together a three-member committee, which will deal with the whole rankings business," said SK Koul, Deputy Director (Strategy & Planning), IIT-Delhi.

IIT-Bombay has identified a nodal person who will collate the information from various departments and send it to QS in the required form. "Even though I have certain reservations about the way rankings are put together, we have to admit that we need to do better," says IIT-Kanpur's Manna. "It's not about numbers, it's about our convictions."

Source: The Economic Times, September 17, 2013
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IITs plan to increase student intake by 60%

The Council of the Indian Institutes of Technology (IITs) on Monday decided to increase the number of students admitted to the prestigious engineering schools by 60%, market brand IIT in India and elsewhere, and engage with global ranking agencies to improve the standing of the schools. At the same time, the council, the apex decision making body of the 16 IITs, signalled that the schools would remain independent of government interference.

The decisions come on the heels of Quacquarelli Symonds Ltd’s (QS) ranking of the world’s top 200 universities which showed not a single Indian institution in the list. A separate list of the top 200 Asian institutions had 11 Indian entities, with three in the top 50. IIT-Delhi was at 38, IIT-Bombay at 39, and IIT-Madras 49.

The Council, whose members include all IIT directors, chairmen of their board of governors’ chairmen, some industrialists and the human resource development (HRD) minister, decided that the IITs would not be reviewed by the National Accreditation Board (NAB) and that the directors of the University Grants Commission (UGC) and the All India Council for Technical Education (AICTE) would have no say in the appointment of IIT directors any more—both moves designed to reiterate and reinforce the autonomy of the schools.

“The council decided that since IITs are brands, their internal review will be given to NAB and it will be accepted as accreditation. NAB won’t be able to sent its team to assess the IITs,” M.M. Pallam Raju, the HRD minister, told reporters in New Delhi.

NAB accreditation is essential for India to be part of the Washington Accord that allows smooth student mobility from Indian engineering institutes to foreign institutes and vice-versa. It also makes Indian engineering degrees equivalent to foreign ones, helps institutes foster better ties in research, curricula and sharing of resources, and also improves a country’s image in the higher education league table.

The decision to increase the number of students in various streams, from average 7,500 per institution to 12,000, over a period of time, is certain to bring cheer to thousands of students who seek admission to the prestigious schools, say analysts. “It will also improve their (the IITs’) earnings (from fees) as well as from non-plan grants from the government,” said Alok Mishra, a director at the HRD ministry. The council said the increase would first happen in the seven older IITs at Delhi, Mumbai, Chennai, Kharagpur, Kanpur, Guwahati and Roorkee.

Although recognized around the world for the quality of its graduates, the IITs haven’t really focused on brand-building, said the minister. “Branding and marketing is important for any institute and IITs have not done this by themselves. Now all IITs will devise a way on how to improve their brand equity,” said Raju. Officials in the HRD ministry said the IITs could together even appoint a chief marketing officer to head this initiative.

The Council also decided that the IITs would form a committee comprising administrators and members of the alumni network to engage with ranking agencies such as the UK-based Quacquarelli Symonds and Times Higher Education ranking. “They have to give complete details of their programs, research and curricula. If IITs give everything up-to-date their ranking can improve by 50%,” said a HRD ministry official.

The Council did not decide to hike tuition fees as suggested by a committee headed by the scientist Anil Kakodkar that proposed charging under-graduate students Rs. 250,000 a year. The IITs had increased fees from Rs. 50,000 to Rs. 90,000 a year in January. The government spends about Rs. 225,000 on each IIT student every year. “It’s up to the IITs now (to consider a revision),” Raju said.

The Council did not discuss the contentious two-tier admission process to the IITs that is currently before the courts.

Source: Mint, September 17, 2013
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Engineering colleges in Karnataka offer freebies to attract students

The college campus wears a somewhat deserted look even during lunch hours. The classrooms are half empty. In one of the classrooms, a teacher stands at the front presiding over a bunch of unusually quiet students. Once in a while, students raise their hands to ask questions, breaking the monotony. This scene from an engineering college on Bangalore’s outskirts can be replicated and applied to many of the hundreds of engineering colleges across Karnataka that are scrambling to fill vacant classroom seats and in their struggle for survival are resorting to tactics never used before—offering freebies such as discounted fees, more scholarships and free hostel to attract students.

Placement heads and principals of a number of engineering colleges conceded the magnitude of the problem and the desperate tactics being undertaken, with students choosing to stay away from these institutes disheartened by the prospect of not landing a job in the country’s $108-billion information technology (IT) sector after graduation.


India trains 1.5 million engineers every year, according to an April research report by Kotak Institutional Equities. But only about 150,000 of them will get jobs in the IT sector this fiscal year, industry lobby Nasscom has estimated.

“The admission figures are very poor. We couldn’t even get 50% of the total intake enrolled (this year),” said M. Uma Devi, Principal of Achutha Institute of Technology, located in Karnataka’s Chickballapur district. “CET (Common Entrance Test, the engineering entrance test held in Karnataka) seems to hold no value now.” She said Achutha had taken a number of steps, such as scholarships, flexible fee structures and discounted admission fees, to attract more students. The college has reduced its fees to Rs. 20,000 per semester for each course, compared with close to Rs. 40,000 last year.

Like Achutha, hundreds of engineering colleges across Karnataka, mostly the smaller and lesser-known colleges, are offering a number freebies and concessions to students, including more scholarships, free hostel accommodation, discounts and free use of library and other additional facilities, according to dozens of college officials, students and experts tracking the sector.

According to a July report in The Hindu newspaper, nearly 80,000 out of about 200,000 engineering college seats are vacant in Tamil Nadu. In Andhra Pradesh, which has the most number of engineering colleges in South India, the figure is even higher at over 100,000 seats, while Karnataka has around 20,000 vacant engineering seats, according to people directly familiar with the development, who requested anonymity. State-level engineering admission authorities in Andhra Pradesh and Karnataka could not be reached immediately to confirm these figures.

“The problem we face is that the big IT companies don’t look at the II or III tier colleges for placements—they only look at the top colleges,” said Vandana Yadav, Placement Director at SCT Institute of Technology in Bangalore, which has an average intake of 60-70% of their total capacity in each batch. “And that can be demoralising for students at a college like ours.” SCT has extended benefits such as free books, free access to the college’s digital library and reduced hostel fees, Yadav said. “I don’t think such steps will help majorly. Given the slowdown in the job market, how will it make a difference?” said an 18-year-old first-year aeronautics student at SCT who did not want to be named.

The plight faced by most of these colleges is symptomatic of a larger and deeper crisis facing the country’s engineering populace—lower hiring in the face of lower demand for the country’s top technology firms, which over the years built large, plush campuses to house and train the hundreds of engineering graduates they mass-recruited from colleges across the country. Last month, Nasscom said it expected IT hiring this year to drop by up to 17% to 150,000, mainly due to an increased push towards automation and lower attrition in the sector. In 2008, the Indian IT sector hired 341,000 freshers, according to Nasscom.

“India faces a unique situation where some institutes (IITs, IIMs, etc) are intensely contested, while a large number of recently opened institutes struggle to fill seats,” said analysts Akhilesh Tilotia and Kawaljeet Saluja of Kotak Institutional Equities in their April report. “Across India less than four-fifths of the capacity is used and this spare capacity is unevenly distributed. It is not surprising that over the last couple of years, anecdotes and instances of ‘capitation fees’ at engineering colleges are not heard as much as they were earlier.” According to figures and estimates provided by the All India Council for Technical Education (AICTE) and Kotak, on an average barely 78% of the 1.5 million engineering seats across the country are filled.

GSS Institute of Technology in Bangalore, too, is handing out discounts to students, said a student who did not want to be named as he didn’t want to upset the college authorities. GSSIT’s Principal Vidyashankar B.V. initially said the college extended discounts and scholarships only to students from poor backgrounds, but eventually conceded that the move was also aimed at filling up college seats.

Other second-rung engineering colleges that are struggling with huge vacancies include Nadgir Institute of Engineering and Technology, Islamiah Institute of Technology, and Bangalore Technological Institute, according to students and people familiar with the matter who requested anonymity. These and another half a dozen colleges contacted for this article conceded that they were operating classes with a strength of 50-60%, but declined to comment on whether they were offering discounts to students. H.S. Nanda, Principal of Bangalore Technological Institute, declined to comment on whether the college had offered discounts to students who were admitted this year, saying that “the management will take that decision”.

“What’s happening now is that the moment you get an engineering seat you negotiate on the fee—that is happening now. Many colleges have started handing out 20-30% discounts or they’ll give you one full year of hostel free,” said Vivek Kulkarni, former IT secretary in the Karnataka government, and founder of Brickwork India, a credit rating agency. “And this has been happening a lot in the newer colleges that have come up.”

According to experts tracking the sector, none of the engineering colleges outside the rank of the top 40 in Karnataka are running at full capacity and hence are being forced to extend freebies to students. “In Andhra (Pradesh), this has been a phenomena for the last 2-3 years or so—in Karnataka, this has become rampant this year,” said Amit Bansal, Founder and Chief Executive of PurpleLeap, which offers training programmes at engineering institutes to improve the quality of education. “Significant discounts on first year fees is a very common tool that is being used—if you look at these colleges, at 50% intake, they’re breaking even— not losing money. If you start falling below that number, you go into the red.”

“Also, getting additional seats from AICTE has become much easier for colleges—so every college has gone ahead and increased their capacity,” added Bansal of PurpleLeap, which has conducted a study at more than 200 engineering colleges across Karnataka to assess the quality of education and employability of the students.

On top of that, freshers’ salaries at top Indian IT firms have remained stagnant the past 4-5 years and not kept pace with the increase in fees charged by engineering colleges. “It’s not surprising to see this happen now—there’s a complete mismatch between the kind of fees the colleges charge and the kind of job opportunities that are available right now. It’s just not sustainable,” said Narendar Pani, Professor at the School of Social Sciences at the National Institute of Advanced Studies.

Source: Mint, September 17, 2013
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Friday, September 13, 2013

No Indian varsity in world's top 200 list

Not a single Indian university or institute of higher learning, including the premier IITs (Indian Institutes of Technology), figure in the top 200 universities of the world, listed by the QS World Rankings 2012 on Tuesday.

The only Indian institution anywhere close to the best is the Indian Institute of Technology (IIT-Delhi), at No. 212. It is followed by IIT-Mumbai (227) and IIT-Kanpur (278). Last year, IIT-Delhi stood at 218, while IITs Mumbai and Madras stood at 225th and 281th positions respectively.

In the Asia Pacific region, 11 universities from India made it to the top 300. Seven of these were IITs. The rest were the universities of Delhi (at No.78) and Calcutta (143), Mumbai University (in the brackets of 151-160) and University of Pune (191-200)

The IITs stacked up thus are: IIT-Mumbai (34), IIT-Delhi (36), IIT-Madras (45), IIT-Kanpur (47), IIT-Kharagpur (56), IIT-Roorkee (65) and IIT-Guwahati (89).

"Asia's other rising economic superpower India remains the only BRICS nation without a university in the top 200... The comparison with other BRICS nations remains unflattering... We see India once again underperforming, with only 11 universities in the ranking, the vast majority of which are various Indian Institutes of Technology," researchers have said.

The 21-year-old Hong Kong University of Science and Technology (HKUST) is the number one university in the Asia Pacific region for the second year running. National University of Singapore (NUS) was in the numero uno position last year.

Chinese investment in universities has continued to pay dividends, with nine of the top 10 Chinese institutions moving up. , including Peking University, which overtook University of Tokyo for the first time - mirroring China racing ahead of Japan in terms of GDP.

MIT knocks out Cambridge
The 803-year-old Cambridge University has been knocked off the numero uno pedestal by Massachussets Institute of Technology (MIT). Harvard which was No.1 till 2009 has been relegated to the third position this time.

"The Cambridge, Massachusetts-based research powerhouse is propelled to the top spot by its superior citation rates and student/faculty ratio. The rise of MIT coincides with a global shift in emphasis toward science and technology. MIT perfects a blueprint that is now being followed by a new wave of cutting-edge tech-focused institutions, especially in Asia," says QS head of research Ben Sowter.

In total, the US is home to a formidable 130 of the world's top 700 universities, having six of the top 10 and 13 of the top 20.The UK replicates its recent sporting triumphs by taking an unprecedented four of the top six places. The University College of London is the fourth best university in the world, while Oxford stood at fifth position. While Imperial College, London grabbed the sixth position, Yale University was voted the seventh best in the world.

Source: The Times of India, September 13, 2013
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Wednesday, September 11, 2013

Foreign universities get independent access to India

The government has decided to allow foreign universities to operate independently in India, set up campuses and offer degrees without having a local partner—a move that finally opens the gates for foreign educational institutions seeking to establish a presence in the country. To foreign universities, the move presents an opportunity to tap a country with a population of 1.2 billion. To Indians (at least those who can afford it), it is an opportunity to receive quality education without leaving India (and without paying in dollars). And to India, it could mean significant foreign direct investment.

The Department of Industrial Policy and Promotion (DIPP) and the Department of Economic Affairs (DEA) have agreed to allow overseas universities to operate as so-called Section 25 or non-profit companies under the newly passed Companies Act, the Ministry of Human Resource Development (MHRD) said on Tuesday. Companies registered under Section 25 of India’s Companies Act cannot distribute profit or dividends to members, which means that the foreign universities cannot repatriate money—a constraint that was criticised by at least one expert.

Several foreign universities have been keen to enter India to tap a higher educational market that is worth Rs. 46,200 crore (Rs. 462 billion) and expanding by 18% every year, according to 40 million by 2020, a report from audit and consulting firm EY. They have been constrained by the need to do so through partnerships.

The Foreign Education Providers’ Bill is still awaiting parliamentary approval. Tuesday’s announcement, which is effectively an executive order, doesn’t need to be approved by Parliament and could see a rush of foreign universities to enter India. “The ministry had sought comments and observations of DIPP and DEA on the rules. Both DIPP and DEA have supported the proposal,” the MHRD said in a statement on Tuesday. Ministry officials said that the details are being vetted by the Ministry of Law and an official notification will be published soon.

With the powers vested in it through the University Grants Commission (UGC) Act, the ministry will allow foreign universities to set up campuses in India and award foreign degrees. Currently, a foreign university needs to join hands with a local education provider to offer courses and the degrees are not considered foreign degrees. Under the proposed rules, foreign universities can set up campuses in India once they have been notified as ‘foreign education provider’ by UGC. An educational institution wishing to operate in India needs to be in the top 400 in one of three global rankings: the UK-based Times Higher Education Ranking; Quacquarelli Symonds ranking published in UK again; and the China-based Shanghai Jiao Tong University rankings.

An MHRD \official said that at least 20 foreign universities—mostly from US, followed by Australia and Canada—have expressed their desire to enter the market. “Universities such as Duke University, California Institute of Technology (Caltech) and VirginiaTech are some of the names that have shown interest,” said the official, who asked not to be identified. Mint could not independently verify this. In September 2012, the University of Chicago Booth School of Business’ deputy dean Robert H. Gertner told Mint that the school was exploring opportunities to open an executive education centre in India.

The degrees awarded by foreign universities in India will be considered foreign degrees and students holding these degrees need to get an equivalence certificate from the Association of Indian Universities (AIU), the MHRD said in its statement. These universities will also function under the UGC rules.

The profit motive
A foreign university cannot repatriate money that it makes in India. And any university seeking entry to India must be accredited by bodies in its home country. “Quality control is key and we will build the safeguard mechanism with each of the universities,” a second official in the HRD ministry said.

An expert was critical of these provisions. “On the one hand you are saying, we want top 400 institutes to come and on the other, you are not allowing them to repatriate surplus to the home campus. It’s a fundamental problem. I think there is still an inherent trust deficit between the government and the (foreign) educational institutes,” said Pramath Sinha, founding dean of the Indian School of Business (ISB), Hyderabad. “They have to stop questioning everybody, at least the best of the institutes. This problem was there in the Bill and if they are retaining it in the executive order, it will be a huge drag,” added Sinha, who is setting up a liberal arts university, India’s first, in Haryana.

The two MHRD officials said enough changes have been made to make it attractive for foreign universities to enter India. The India campus will function as a branch campus of the parent, rather than as an independent campus. The universities will offer the same degree they are offering in their parent campus. And the ministry has reduced the deposit universities have to maintain with the ministry (and which they will forfeit in case of any violation) from Rs. 50 crore (Rs. 500 million) to Rs. 25 crore (Rs. 250 million).

To be sure, it will not be easy for foreign universities to acquire land, especially in the context of India’s new land acquisition law. “We will not facilitate the university in getting land at a concession. Anyway, procuring land and other infrastructural facilities in India will be way cheaper than in developed countries,” said the first ministry official.He added that there were still three things that would attract foreign universities to India: a huge education market and the young demography to grow that further; lower recruitment and research costs; and the opportunity to offer executive education programmes and consulting services to Indian companies. The second official grandiosely described the ministry’s move as “liberalizing the higher education space the way India economy was liberalized between 1991 and 1993”.

Manish Sabharwal, the chief executive of staffing and training company TeamLease Services Pvt. Ltd, said that India remains an attractive destination for education. In many countries there are two problems, he added—demography and cost—but in India both the issues are in the right place. The problem, he said, is in the details.

Anton Muscatelli, Vice-Chancellor of the UK-based University of Glasgow, too stressed the importance of details. The Indian government’s willingness to allow universities to come into India should certainly boost the entry of foreign universities, but the details will be important, he said. His own university, he added, has several partnerships in India and will continue to work with strong Indian partners.

Once it is notified, the ministry’s order will render irrelevant the Foreign Educational Institutions (Regulation of Entry and Operations) Bill 2010, a brainchild of former HRD minister Kapil Sibal, who is currently in charge of the telecom and law ministries.

Source: Mint, September 11, 2013
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