Foreign Universities Entering Indian Market – Will they bridge the gap?


Foreign Universities Entering Indian Market – Will they bridge the gap?

[Part of our coverage of Education Industry in India, we bring one of the most important step Indian government has taken in the recent times, i.e. the decision to open up the education system for FDI].

Huge gap exists in educational system in India, especially in the higher education space. Take the case of MBA colleges. Beyond the top/best MBA colleges in India, there are hardly any colleges to talk about. Beyond the list of top 25 B-schools and top 20 engineering colleges in India, there are hardly worthy names to talk about.

Almost 300K students apply for CAT every year [the number is growing at 20% CAGR] and its quite natural that the 25 B-schools cannot accommodate even 40% of them. In short, the problem starts where the top B-school, or top engineering college list ends.

Facts and Figures

  • India has 480 public universities and more than 25,000 undergraduate colleges.
  • 13 million students ready for higher education, and only 12% of them get the proper education.

Winds of Change

Recently, the Cabinet approved Human Resource Development Minister Kapil Sibal’s proposed law [for FDI in education sector] and the same will be voted in parliament in the coming days.

Foreign universities like Harvard and Oxford have already set aside $60mn each, while Wharton has planned $50mn for India foray.

The universities that are going to be set up at all in India should have an Indian eco-system. Why should we want an Oxford here? We don’t get children from Eaton and Harrow. But yes, the quality of an Oxford is required in terms of research – of academics, knowledge generation and syllabi flexibility. So we should build institutions which are equivalent to those outside the country. And allow quality to come into the country, because there’s a huge gap between supply and demand. And since demand is going to increase exponentially, because India has a young population, we need to increase the institution of the supply. And all stakeholders – industry, private sector, foreign universities and public partnership should have a chance to participate in the system. – Kapil Sibal, HRD Minister

Big Challenge for Indian Institutions

One of the biggest challenge for most of the top educational institutions in India has been the lack of good faculty.

With the pillars of education, the faculties from 60s retiring, most of the colleges are facing a severe challenge. That of retaining good talent and attracting researchers, professors to join them.

Holi at Stanford - The Colors will Change!
Holi at Stanford - The Colors will Change!

How many IIT/IIM alumnus are joining back? I recently met a Professor from one of the IIMs and he shared an interesting perspective on private institutions that many of the profs, even though they rejected offer from a competitive institution in 2006 are rethinking their decision and might as well join the institution.

Why? Money being an important factor, what was currently missing with few private institutions has been a dedicated focus on research (which is why these professors quit their high paying jobs and landed up in ‘teaching’ job).
But lately, private institutions are partnering with other foreign universities (and companies) to set up research facilities and are doing it in a more consultative environment as compared to other colleges.

With more foreign universities coming into India, the homegrown ecosystem will face a stiff challenge

  • Matching the global standard/curriculum which are more result oriented than theoretical knowledge.
  • Managing the faculty expectation [in terms of salary/R&D approach etc] as well as keep improving the infrastructure.

At the same time, it won’t be an easy walk for the foreign institutions.

Corruption, Bureaucracy, Lack of clarity on educational reforms, Differences between state and central government [who owns what?], Caste based reservation system – best represent the state of current educational system in India.

We sincerely hope that this doesn’t turn out to be just another lip service by UPA government. All one knows is that bringing foreign universities to partner with Indian colleges will help increase the bar, bring more serious competition among the educational institution and will benefit the entire ecosystem.

Only if it happens.

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