17 Oct Opening Doors for Foreign Education in India : An Evaluation
The Indian Overseas Education works in co-operation with the United Nations Educational, Scientific and Cultural Organization (UNESCO).Its Constitution is based on a beautiful thought, which says “since wars begin in the minds of men, it is in the minds of men that the defenses of peace must be constructed”. With this motivating thought lets evaluate the foreign investment reforms in India.
The Indian Education system has released the New FDI policy under which norms for foreign investment has been defined. Under the new FDI policy, investment can be made in Indian companies, partnership firms, proprietary concerns, venture capital fund and trusts which are in the form of a venture capital fund. It restricts investment in trusts (other than venture capital funds) and societies. The Government of has permitted foreign direct investment up to 100%under the automatic route in the education sector, subject to the sectoral rules or regulations as may be applicable.
On further reading of the Circular, we have to take note of the provisions of the FDI Policy and the various state enactments relating to the establishment of educational institutions in India indicates that foreign investment in society and trust is largely made difficult due to the stringent regulations. However one of the popular route of investment is by channelizing foreign investment into the company which provides services to the society and/or the trust running the educational institution. The society running the educational institution pays fees/rentals to the infrastructure company and thereby helps the investors to extract returns on its investment. One must ensure that the transactions between the management companies and the society, trust or “not-for-profit” companies are conducted at arms length basis and proper authorisation is sought.
In addition, the Ministry has been making efforts for strengthening cooperation with foreign countries through other mechanisms too. An MOU was signed for operation of the India-UK Higher Education Leadership Development Programme for strengthening cooperation and exchange in education.
An objective analysis for the needs of the education sector is under process to provide better opportunities for student, educational institutions need to be equipped with the basic and world class infrastructure and support. By issue of new rules and regulations, a wider participation be achieved by the private players and the central and the state governments.
Indian higher education has to consider liberalization to be a priority. Could opening up the higher education to foreign investors akin to retail, telecom etc. be the panacea we are looking for? These are certain issues which require consideration. One of the major concerns regarding liberalizing higher education in India is the possibility of ‘commodification/commercialisa-tion’ of higher education.