Relenting to pressure from the Indian Institutes of Management (IIMs), the government has diluted the provision in the draft rules under the new IIM Act that had sought to put a condition on the tuition fee charged by the 20 elite business schools.
As first reported by The Indian Express on June 21, the HRD Ministry had shared a copy of the draft rules with IIM chairpersons for feedback, to which some of the older institutes had objected to the clause that mandated the Board of Governors (BoG) to “ensure that the fee charged from the students shall be commensurate with the overall expenditure for maintenance and expansion of the institute”.
The older institutes were uncomfortable with the above provision because they do not take any funds from the government for maintenance and expenditure, sources within the IIM community had told this newspaper.
The ministry is learnt to have diluted the clause, which now reads that “all institutes shall endeavour to ensure that concrete steps are taken by each institute to lower the cost of education and no deserving student is denied education in the institute for want of funds”.
Unlike the IITs, education at the IIMs is not subsidised by the government. The premier business schools charge between Rs 10 lakh and Rs 22 lakh. The fee for the two-year postgraduate programme at IIM-Ahmedabad and IIM-Bangalore is about Rs 21 lakh.
While the institutes in Indore and Lucknow charge Rs 14 lakh for the same, the postgraduate programmes at IIM-Calcutta and IIM-Kozhikode cost Rs 20 lakh and Rs 17.5 lakh, respectively.
In addition to the clause on fee, the government has deleted the provision that mandated the institutes to sign an annual Memorandum of Understanding (MoU) with the government on performance parameters, student intake, expansion of institute and output targets.
The IIMs had objected to this provision on the ground that it would allow the government to influence their working.
Instead of signing an MoU, the business schools will now have to submit a three-year action plan, five-year strategic plan and a 15-year vision plan to the government, said sources.
That apart, the ministry, under the revised draft rules, no longer has the power to issue “binding” directions to the IIMs if they are found to be acting in contravention of the Act.
The IIM Act, which came into effect on January 31, grants statutory powers to all 20 IIMs, including for appointment of directors and chairpersons and Board members. With this law, the institutes can also award degrees, instead of diplomas, for their postgraduate programmes.
The rules, under the Act, define finer details such as the procedure for appointment and removal of an institute’s chairperson and director, their powers, and the functions of the BoG.