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National Issues/ Economy/ Politics

Whether we should privatize higher education?

“Reliance” will enter the education sector to provide quality higher education as it emerges as the next profitable opportunity.

A range of private enterprise has already set up international schools and they are doing well. And some fly-by-night operators have entered too rather they were always there!
The state has a role to play in order to modulate this enthusiasm amongst the eligible ones so as to maximize the social cause. Let’s face it…Population and education have always been the most sought after sectors that need correction. In countries like US, UK and other developed , private enterprise have always played a role to better education standards as well to provide scholarships to the ‘worthy’ students aspiring for higher education. Of course, the scene is far better in India when compared to 20 years back. PSU banks and other institutions have started disbursing educational loans that were not available earlier.

We should allow companies to run educational institutions as well-run businesses that have transparent accounts and declare dividends. But a word of caution…entry of private funds into higher education is not a case for the state to withdraw from the sector. Rather the state should deepen their involvement and give it a different shape. Higher education is expensive, many will agree. A good part of the cost in providing higher education should be recovered from ‘realistic fees’ from the students. At the same time, it must be ensured that lack of funds does not kill the dreams of attending college by well deserving students coming from poor families. A large part of government funding should be in form of scholarships which are liberal.

Securitized loans by government undertaking banks is already happening as mentioned earlier in this passage. That is a good step taken by the PSU banks.Hence there is mix of private enterprise and modulation (read control) by the government required to uplift the standards of education in this country.


About Raman Ramamurthy

I am a Management consultant, an avid reader, play Lawn tennis in my leisure time and love Music. Presently, I am settled in India along with my wife and my son.


4 thoughts on “Whether we should privatize higher education?

  1. I was happy with the initial part of what you were saying, but you lost me where you want deeper state involvement in higher education. Why must taxpayers who're not interested in obscure subjects like Music therapy and many more be forced to subsidize those programs in the form of government scholarships. Acc to me, the state involvement in higher education should be phased out. Right now, the government controls higher education to such an extent that the inefficiency is intolerable. If we want to help those who are paying high tuition in private colleges, let us give them tax credits corresponding to that amount.


    Posted by Liberal | December 1, 2009, 2:11 am
  2. I like the author's perspective. I think there is a role for PSUs, and state/central governments to play a role in education. They could do so by subsidizing loan terms to the deserving. Of what use is governance if it cannot contribute to the betterment of its subjects and thus ensure societal growth and prosperity. As the author points out, in developed countries, the private and public sectors play a role (each their own).


    Posted by avalok ishwar | December 1, 2009, 3:54 am
  3. There appears to be a meaning in what the Author says about the PSUs contributing to the cause by lending however with the kind of credit indiscipline being seen in these loans also there will be very little left with the lenders unless we repeat the exercise done for the Farmers.


    Posted by yaaro Oruvan | December 3, 2009, 7:39 am
  4. There is a need to privatize higher education as that would stop ‘brain drain’ too. The private sector can run professional higher education schools/colleges.The state involvement is required to ensure equal opportunity especially to poor meritorious applicants.


    Posted by rambuna | December 12, 2009, 9:24 am

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