Pratyaya | Foreign Educational Institutions Entry to India – Myths and Facts

The decision to allow foreign educational institutions to operate in India in principle is good but there is more to it than meets the eye. The policy has unintended consequences of restricting than inviting educational institutions.

The Foreign Educational Institutions (Regulation of Entry and Operations) Bill, 2010 has been pending in the parliament for the last three years. While all the disruptions and adjournments made way for smooth functioning of parliament when it came to passing food security bill or land acquisition bill but education is far down on the priority list. The government, for all the reasons best known only to Ministry of Human Resource Development (MHRD), has shown sudden and unusual enthusiasm to allow foreign universities through an executive order by allowing them to register under section 25 of the Companies Act. If a bill is pending in parliament, is it appropriate to pass an executive order of this nature? and if the answer is yes, then why did MHRD wait for three years to do the same?

Even if we ignore the democratic argument, there are some other fundamental issues with the approach. Education strategist Ms. Meetasenguta rightly questioned the missed opportunity and the relevance of the policy now. The answer to why we need foreign educational institutions is simple: It is not to address the supply constraints (many seats in India are already lying vacant across streams), what India desperately need is good quality research oriented institutes. The quality of Master/PhD programs even in the best of our universities is mediocre and we need established institutes which can bring new culture and infrastructure for creating better talent pool. For this to happen, we have to the top institutes in the world to open their centers in India. PMO should start the dialogue with top colleges and facilitate the process, if required, by giving necessary and reasonable concessions. But this requires two things: a) Discretion and b) Trust. The current policy environment is devoid of trust and every exercise of discretion is accompanied by a CAG imaginary notional loss figure. Considering this background, it would be prudent to delay this process and let the next government initiate it in a more organized way and through legislative process.

Unlike FDI/FII in other sectors, which are primarily investment opportunities, education is a non-profit venture and the incentives for foreign institutions are minimal. If we read the bill, the wording is not of government requesting foreign institutions to come to India, it is more like “Be very thankful to us that we gave you an opportunity to invest hundreds of crores with zero return”. Government is of the view that a) there are thousands of universities desperate to get into India and b) we cannot allow so many institutes to step in and so we have to over regulate the entry. But the findings of the standing committee report state otherwise: “On a specific query about the Foreign Educational Institutions having approached the country, Secretary informed the Committee that in the absence of any facilitating framework, very few Foreign Educational Institutions had formally applied for setting up institutions in the country so far”

Far from providing a facilitating framework, the bill only talks about regulating the entry as we can read from the first paragraph of the statement of objectives and reasons of the bill:

“A number of Foreign Educational Institutions have been operating in the country and some of them may be resorting to various malpractices to allure and attract students. There is no comprehensive and effective policy for regulation on the operations of all the foreign educational institutions in the country. Due to lack of policy or regulatory regime it has been very difficult to make meaningful assessment of the operations of the foreign educational institutions and absence of such meaningful assessment has given rise to chances of adoption of various unfair practices besides commercialisation.”

Another intriguing (but completely normal for the government) aspect is the suspicion about everything that is foreign. The government believes that every foreign university is out there to threaten the security and integrity of India and hence their content and curriculum must also be regulated. The same kind of suspicion led to Ministry of Home affairs/MHRD (through UGC) forcing Manipal University to terminate the MoU signed earlier this year with Beijing Institute of Technology.

According to a report in liveMint, the government will not facilitate the land acquisition process. We are left to imagine that the Director of Harvard will be sitting on a negotiating table and spending all his time on land deals and in complying with the draconian provisions of the new land acquisition act, like preparing social assessment reports and tracking the investigations by magistrate etc.

Tough regulations, no profit on Investment, uncertainty and no academic freedom — Is this how our policy should be if we are interested in getting the best foreign institutes? The institutes which can really impact will not venture into and those who are interesting in coming may not add much value.  The policy as it stands, if implemented, far for benefitting students will send a bad signal to the foreign institutions.