Foreign universities in India – A reality check, again!

“A revolution is brewing in the higher education sector with foreign universities waiting for India to open its doors to them.”, says The Telegraph in August 2009 and Inside Higher Ed echoed the optimism and prospects of finding “a passage to India” for foreign universities.

More than three years later sentiments have reversed with pessimism and frustration overtaking optimism. The Chronicle of Higher Education sums up with a headline “For U.S. colleges in India, great possibilities, thwarted hopes” and Times Higher Ed finds “As India plays hard to get, overseas suitors lose interest.” University World News reports challenges at Leeds MET India, one of the “first” foreign campuses in India, which decided to not wait for the approval of the foreign universities bill.

Several big names like Duke Fuqua, Virginia Tech and Georgia Tech have all scaled down their ambitions from full-fledged degree campuses to smaller partnerships.

What happened? A case of misplaced optimism.

In March 2010, I blogged –“Foreign Universities in India: A Reality Check” and argued that there is a huge mismatch between understanding of what Indian policymakers believe foreign universities want and what foreign universities want to do in India.

I offered a broad schema to highlight that that there are three segments of foreign universities interested in coming to India with different needs and objectives: 1) Prestige-enhancing (top-50 research universities): 2) Prestige-seeking (next-tier of 100 universities): 3) Revenue/profit maximizing.

Policymakers were interested in attracting top global universities without understanding that there is no need or interest among this segment to build branch campuses or offer degree programs, unless they are funded or financially supported by the host country (e.g. NYU in Abu Dhabi).

At the same time, foreign universities bill proposed upfront barriers like requirement of corpus fund of $10 million and non-repatriation of surplus, which pretty much eliminated all leading universities, especially publically funded ones, which cannot justify with their stakeholders to put an upfront money with no hope of recovery.

Given no financial support from government and at the same time, high financial barriers to start-up, the only way resources could be pulled together was through corporate funding or philanthropy. However, corporate funding means potential for ramping up number, growth and potentially “profit-orientation” and culture of philanthropy is weak in India.

The “for-profit” institutions were proposed to be not allowed to operate in India as the foreign education provider has to be established as a non-profit organization. This is ironical, as many private “non-profit” institutions are cooking books with clear goals of profit maximization.

And of course, the complexity, inertia and confusion of politics and policy-making in India did not help either.

So, what works?

My core recommendation to foreign institutions to “incubate” the partnerships and not to think about grandiose plans of branch campuses. Indian higher education is rich with opportunities but rife with challenges and hence it is important to start now, howsoever small an engagement it is. Higher education institutions need to take calculated risk and “start-up” mentality of working with several institutional partnerships of varying intensity and resources and ramp them up over time. Of course, knowing complexities, context and challenges of working with India is a sure ingredient for success and the other is patience!

I am also co-presenting a webinar entitled “India – The Next Frontier” hosted by American Council on Education.

Related resources:

Dr. Rahul Choudaha
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2 Comments

  1. I’m so glad I found this site…Keep up the good work I read a lot of blogs on a daily basis and for the most part, people lack substance but, I just wanted to make a quick comment to say GREAT blog. In your next post, provide the Education Institutes in India, so that students come to know about the colleges. Thank for the sharing.

  2. In India, quality Higher Education is very scarce. Most Institutions in higher education be it technical, scientific, liberal arts and humanities or management sciences have problems of infrastructure, quality faculty and staff if they are Govt. supported and possibly have reasonable infrastructure but poor faculty quality if private. IITs and IISc have benefited from over 50 years of autonomy and freedom from political interference. Hence they are relatively in much better shape (as some of their sister Institutions like UDCT who also enjoyed a relative autonomy). But the University at large have not been so lucky and the private Institutions which have mushroomed in last few decades depend on a lot of PR campaign for attracting their clientele. There is an enormous scope to offer quality higher education in India as very few can access it in some of these reasonably good Institutions. Foreign University can draw on the advantage of their superior processes and modern technology but will still face a challenge of quality faculty. They need to consider several different models for offering their product. Overall the Indian crowd is very hungry for higher education and may be able to afford the costs at about one fourth of the cost incurred for higher education abroad. But this is just a guess. The Institutions will certainly have to consider the long term implications of bringing higher education in India and accordingly thinks of the price they may want to charge. I personally welcome the move. Virendra Sule, Professor, IIT Bombay.

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