Market-driven education model good

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Is Market Driven Educational Model (Encouraging Privatisation in Higher Education)
Good for India’s Future?
Dissertation Sample
Disse
her Educ
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Abstract
This paper examines the need for encouraging market driven higher education higher
education model in India. In this context, the present study is focussed on privatisation in the
This papapa er examines the need fofof r encoururu aging market driven hig herher education high
education model in India. In this context, the present study is fofof cussed on then privatisation in t
Methods- The present study is a qualitative research conducted with former vice chancellors,
former Higher Education Minister, State of Karnataka and the administrators of private and
public higher education institutions.
f
p
fofof
p
or
pububu
cation Minister, State of Ka
tion institutions
uca
at
u
ca
rmer Higher Edu
blic higher educ
administrators of private andarnataka and the a
pppuububu tion institutions.atcablic higher educububu tatcablic higher educ
be improved. Majority of participants belonging to public higher education institutions stated
the significance of privatisation in the educational sector.
bbbee impmpm roved
thee significan
d. Majojoajoa rriity o
nce of privat
of
ti
f p
isa
ngingg to pububu lic higherr education inst utions state
cational sector
ng
ca
ong
ca
cipants belo
n in the educa
parti
ationthee significannce of privattiisa cational sector.cacan in the educaation
Dissertation Sample
n titu tedtitu ed
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Table of Contents
Abstract......................................................................................................................................2
List of Table...............................................................................................................................5
List of Figures............................................................................................................................5
CHAPTER I: INTRODUCTION...............................................................................................6
1.0 Background ......................................................................................................................6
1.2 Research Objectives.......................................................................................................10
1.3 Research Questions ........................................................................................................11
1.4 Scope of the study ..........................................................................................................11
1.5 Chapter scheme ..............................................................................................................11
CHAPTER II: LITERATURE REVIEW ................................................................................12
2.0 Encouraging privatisation in Indian Higher education ..................................................12
2.1 Defining the terms..........................................................................................................13
2.2 Relationship between Liberalisation, Privatisation and Globalisation...........................15
2.3 Privatisation in the educational sector............................................................................16
2.4 Privatisation of higher education in Global context.......................................................18
2.5 Privatisation in the Indian educational sector ................................................................21
2.6 Indian government policies on privatisation of Higher education.................................25
2.7 Issues in Privatisation of higher education in India .......................................................29
2.8 Need for Privatisation in higher education.....................................................................30
2.9 Political economy of higher education in India .............................................................31
2.10 Previous studies............................................................................................................33
2.11 Research Gap................................................................................................................35
CHAPTER III: RESEARCH METHODOLOGY ...................................................................36
3.0 Introduction....................................................................................................................36
3.1 Research design..............................................................................................................36
3.2 Research philosophy ......................................................................................................37
ous stu
ch Gh Gh ap...............................
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onal ector ...............................
atio of Higf Higf
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and G
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3.3 Research Approach ........................................................................................................37
3.4 Target population and sample size.................................................................................38
3.4.1 Sampling technique .................................................................................................39
3.5 Data collection................................................................................................................40
3.5.1 Data collection methods ..........................................................................................40
3.5.2 Interviews in educational research ..........................................................................40
3.5.3 Procedures for preparing for the interviews ............................................................40
3.5.4 Validity and reliability in interviews.......................................................................41
3.6 Analysis of the interview................................................................................................41
3.7 Summary ........................................................................................................................42
CHAPTER IV: RESULTS.......................................................................................................43
4.0 Introduction....................................................................................................................43
4.1 Participants.....................................................................................................................43
4.2 Role of privatisation in higher education development in India ....................................46
4.3 Perceptions of stakeholders towards choosing higher education institutions ................48
4.4 Views of Indian Government on privatisation...............................................................50
4.5 Encouraging privatisation in India .................................................................................52
4.6 Private Universities and high standards of higher education in India............................54
4.7 Role of privatisation in maintaining equity and accessibility ........................................56
CHAPTER V: DISCUSSION AND CONCLUSION .............................................................58
5.0 Role of privatisation towards satiating the ever-growing need for higher education in
India......................................................................................................................................58
5.1 Effects of privatisation in Indian higher education ........................................................61
5.2 Governmental regulations and privatisation ..................................................................62
5.3 Governmental regulations and privatisation ..................................................................64
5.4 Implications....................................................................................................................64
5.5 Conclusions....................................................................................................................66
of p
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............................... ...............................
n in Indian hig
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N ANANA D NCLUSION
rds s tiating t v
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ions ...............
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REFERENCES ........................................................................................................................68
Appendix..................................................................................................................................82
List of Table
Table 1: Semi-structured interviews conducted with vice-chancellors and XXX of private
institutions................................................................................................................................39
List of Figures
Figure 1: World higher education enrolment rate......................................................................7
Figure 2: Private Enrollment and Institutional Share in Higher Education in Selected Asian
Economies, 2002–2009............................................................................................................20
Figure 3: Total number of Private aided, unaided and government higher education
institutions in India (State-wise)..............................................................................................22
Figure 4: Total number of Private aided, private unaided and government higher education
institutions in India (total)........................................................................................................23
Figure 5: Procedure to establish a private university...............................................................28
Figure 6: Participants in the study ...........................................................................................45
Figure 7: Word cloud of Role of privatisation in higher education development in India......47
Figure 8: Word cloud of Perceptions of stakeholders towards choosing higher education
institutions................................................................................................................................49
Figure 9: Word cloud of Views of Indian Government on privatisation.................................51
Figure 10: Word Cloud of Encouraging privatisation in India................................................52
Figure 11: Word Cloud of Private Universities and high standards of higher education in
India .........................................................................................................................................54
Figure 12: Word Cloud of Role of privatisation in maintaining equity and accessibility .......56
Figure 13: Estimated 18-23 year old population in India- 2030..............................................59
...............................
rd
ted 18-23 yea
ud of P
...............................
ole of p vatis
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...............................
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ment high educa
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CHAPTER I: INTRODUCTION
1.0 Background1.0 Backgroundg
work, at communities and so on. To satiate the ever increasing need for education and
knowledge empowerment, educational institutions all around the world evolve continuously.
In a global context, higher education is under constant pressure with the following
requirements- to meet the expectations of education, increase student enrolment, increase
workforce needs of the nation which in turn affects economic development positively
(Educause, 2010). To meet the needs of higher education, developed and developing
countries have begun embracing the concept of ‘Privatisation’. Privatisation is defined as the
(Educause, 2010). To meet tth her education, developed and developingighhe needs of hig
countries have begun embracin f ‘Privatisation’. Privatisation is defined as theofng the concept o
expansion of private control over public good ‘education’(Jonaki & Prasenjit, 2016).
Though it is claimed that privatisation has its role in higher education all over the
world, factors such as globalisation and liberalisation have combined effects on higher
education (Vlk, 2006). Over the past decades, private higher education in the world has
witnessed remarkable progress with more than 30 per cent of private enrolment globally. By
the year 2012, the number of student enrolment in higher education institutions reached 196
million whereas the same in the year 2000 was just below 100 million (Kassim et al., 2015).
Private education has been in existence in many countries for years and is the traditional
million whereas the same in the year 2000 was just below 100 million (Kassim et al., 2015).
Private education has been in existence in many countries for years andd ld is the traditional
70% private enrolment and almost half the student population in nations such as Brazil,
Mexico, and Chile are educated under private higher education institutions (UNESCO, 2014).
The impact of private sector could also be envisioned in the eastern European as well as the
African countries. Developing economies such as India and China are no longer an exception
and embrace private sector higher education. Researchers argue that privatisation in the
1
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nations which include increasing technologically and practically empowered workforce
(Rena, 2010).
Figure 1: World higher education enrolment rate
Source: Adopted from UNESCO (2016)
The expansion of higher education in India is in a rapid pace and the increase in
progress of higher education institutions in India discerns the growing knowledge
requirements of student population in the country. Private sector plays a predominant role in
delivering knowledge to the youth population in the country. A dire need for professional
education always exists in the country and the participation of private sector is deemed to be
more important. Privatisation in the Indian higher education sector has emerged in several
types and forms over the years (Tilak & Varghese, 1983a). Privatisation takes place in the
more immpmpmport on iniotirtant. Privati tthe ducation sector has emerged in severaledere Indian higher
typypy es anndd f ears (yyfofof rms over the (TTil 1983a). Privatisation takes place in thee, 1983elak & Varghese
purpose of profit are termed commercial private higher education institutions. Private
individuals play ownership role in setting up private universities, deemed universities and
foreign collaboration universities (Jonaki & Prasenjit, 2016). The economic reforms which
were implemented in the year 1991, led the nation to adopt several changes. Open markets
0
50
100
150
200
250
2000 2002 2004 2006 2008 2010 2012
Higher education student enrolment rate
Number of students (in
millions)
1
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eased state governments of the nation to set up private universities. According to the
University Grants Commission (UGC), by the end of 2015, there were 43 central universities,
312 state universities, 115 deemed universities and 183 private universities in the country
(Dhanuraj & Kumar, 2015).
The increase number of enrolment in private sector higher education institutions and
the number of private institutions in India increasing every year positively define the success
of privatisation in the higher education sector. Education in this regard is considered to be a
tool to establish individual status in the community; hence the need for higher education is
of privatisation in the higher education sector. Education in this regard is considered to b a
tool to estabtabta lish indiv e community; hence the need fofof r higher education isvidual statutut s in the
developments (World Bank, 2000).
Several challenges necessitated the need for privatisation in the higher education
sector of India. Firstly, the population of students (age group: 15-35 years) in the nation in the
year 2010 was around 350 million and Altbach and Jayaram (2010) predicted that the
numbers will peak at 485 million in 2030. The previous researchers argue that the
Government will tremble to meet the needs of higher education only with public sector
institutions and meeting quality education needs for such huge numbers is a complicated task.
Government will trembmbm le to meet the needs of higher educat on only with pububu lic sector
institutions and mee cation neeeting quality educ e numbmbm ers s a compmpm licated task.eds fofof such huge
rural counterparts is 7.5 per cent. Thirdly, the quality of education delivered by public
institutions is so poor which is attributed to reasons such as lack of infrastructure, out-dated
curriculum, less research innovations and practical empowerment. Lack of skilled workforce
emerging from public institutions demotivates organisations to employ such candidates.
However, only a few public higher education institutions such as Indian Institutes of
Technology (IITs) and Indian Institutes of Management (IIMs) satisfy the needs of corporate
organisations by delivering quality manpower resources (Sudarshan & Subramanian, 2012).
Indian government (both state and central) suffer from serious monetary allocations to fund
higher education which could be balanced through private sector. The enrolment of students
1
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in higher education institutions in India has grown phenomenally wherein the number of
enrolment is 25.9 million in 2011-12 and the same in the year 1970-71 was 2 million (Ernst
& Young, 2012).
e ol e s 5.9
& Young, 2012).
o 011011 e e yea 1970 7 was o ( sea d e sa011
& Young, 2012)012).
1. Resource allocation- The resources allocated by the state and central government
to public higher education institutions does not facilitate the proper management
of these institutions. On the contrary, private owners may fund considerable
amount to maintain private institutions.
2. Sensitivity- Private sector institutions adopt changes flexibly whereas the same is
not possible in public sector institutions.
3. Quality- Better quality of education is provided in private sector institutions rather
than public sector institutions.
4. Accessibility- With more number of educational institutions, private sector serves
to cater the educational needs of all citizens in India.
5. Reduced burden- Governments may concentrate allocating resources to other
sectors (Patel, 2012).
Though it is claimed that privatisation has its role in higher education all over the
world, factors such as globalisation and liberalisation have combined effects on higher
education (Vlk, 2006). Globalisation has impacts on the higher education system of India.
The reforms of education in India, especially with the liberal motives of the Government to
allow private participation in the higher education sector underline the perception of the
government to enhance the utilisation of information technology resources thereby
allow private participation in the higher education sector underline the perception of the
government utilisation of inforforf mation technology resoururu ces therebyto enhance the
contrary, globalisation will bring development in education through technology,
communication and knowledge. Due to privatisation, the quality of education delivered
becomes industry oriented and the increase in globally acknowledged higher education
institutions transforms India into a knowledge hub (Naik, 2015).
1
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Though privatisation in Indian higher education is a boon, many researchers claim
that the advent of private sector in education sector tends to be hazardous as the equity to
educational access is affected. A study by Chougle (2014) on understanding the perceptions
that the advent of private sector in education sector tends to be hazardous as the equity to
educational access is afffff ecfecf ted. A study by Chougle (2014) on understanding the perceptions
sector, the economically weaker sections may suffer. Other factors in the raking include fear
of unethical practices or no ethics, commercialisation of education and lack of social
commitment (Chougle, 2014).
There are contradictory ideas regarding the feasibility of private sector participation in
the Indian higher education sector. Though different researchers claim the devastating role of
privatisation in the sector, the economy of the country necessitates such participation. The
ideologies on equity and accessibility are questioned since privatisation has both positive and
negative effects on the factors. While private sector institutions aid in meeting the ever-
growing demand for higher education in a highly student populous nation, the cost of
acquiring private higher education is not within the reach of poor economic class who form a
growing demand for higher education in a highly student populous nation the cost of
acquiring private higher education is not within the reach of poor econ mic class who form a
education as feeble resources are allocated for higher education purposes of the country.
These inferences act as the premise to the present study which is based on the analysis of
private participation in Indian higher education sector. Privatisation poses both advantages
These infefef premise to the present study which is based on the analysis oferences act as the
private par an higher educa on sector. Privatisation poses both advantagesrticipation in India
nation.
1.2 Research Objectives
1. To determine the effects of privatisation in Indian higher education
2. To examine the role of privatisation towards satiating the ever-growing need for
higher education in India
3. To analyse and interpret the perceptions of educational pioneers towards the market
driven higher education market.
01
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Obje
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of
India
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of p
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Priva n
cation
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nation, he c
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1.3 Research Questions
1) What are the effects of privatisation in Indian higher education?
2) Does privatisation in Indian higher education satiate the ever-growing needs of
student population in the country?
3) How do educational pioneers in India view privatisation of higher education?
1.4 Scope of the study
The scope of the present study is bound within the limits of examining the effects of
privatisation and market driven model in Indian higher education. Hence, the present study
focuses on the regulations regarding privatisation in different states of the country wherein
the laws are varying for each state in the nation.
1.5 Chapter scheme
The first chapter covers the introduction of the study wherein the background of the
study, the research objectives and the scope are elucidated.
The second chapter is the literature review in which the knowledge which is
previously discussed relevant to the present topic of the research will be identified and
analysed. The chapter further elucidates the findings of various researchers who devised
researches similar to the context of the present study.
The third chapter covers the research methodology. The different methods of data
collection, and the analysis techniques used will be elucidated following which the type of
research methodology used in the present study will be explained
The fourth chapter will cover the results. Different techniques are used to analyse the
variables of the study. The results of the study will be analysed, examined and summarised.
The final chapter will be discussions and conclusions. The findings of the study will
be discussed elaborately and the conclusions will be stated. Additionally, future studies in the
same context will be recommended.
01
a
y
chap
ly a d the c
nde
ter will
results of t
e dis n
onc
esea
used w
he pres tudy will
the esults. Dif
tutut dy ll b
t study.
h met dol
be el
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ings
The diff
whi
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CHAPTER II: LITERATURE REVIEW
2.0 Encouraging privatisation in Indian Higher education
The present chapter of the dissertation is dedicated to understanding the different
literatures on the subject of privatisation of higher education and India since its independence
in 1945. Ever since India attained the status as a ‘republic nation’, education in the country is
based on the principles of empowering the citizens of the nation and the responsibility of the
state is to create an environment which enables all its citizens to be empowered. In this
regard, the Government of India adopts strategies to maintain the growing population and
increasing rate of youth through the creation of capacities. Over the years of development in
the Indian educational sector, the Government is enlarging its capacities by investing more on
enhancing the existing institutions. During the year 1950-51, there were around 28
universities and 578 colleges in the entire country while the scenario of today is widened.
India is now the hub for a number of educational institutions, especially institutions satiating
higher education needs. In 2014, there were a total of 36,812 colleges (20,390 colleges
private institutions and 6,768 public colleges) in the country which transforms India as the
knowledge spot for more than 20 million students enrolled in these institutions (Shankar,
2016). However over the last two decades, the need for skilled labour and practical expertise
is increasing wherein companies demand for expertise, education and skilled manpower. In
order to meet the growing needs for manpower in an ever-evolving economy, privatisation
aids with complementing the public educational institutions. Over the past decades, the factor
called ‘capacity creation’ is steered with the aid of private institutions. The emergence of
higher education in India began in the mid-1980s which is to subsidise the investment
reduction of the Government and the states towards education. The share of the private
unaided institutes is 43 per cent in 2001 and the percentage of students is 33 per cent.
However, the percentage rose and in the year 2006, the percentage share of private
institutions was 64 and the percentage of students rose up to 52 per cent (Sudarshan &
Subramanian, 2012).
Privatisation has always been a hot topic of debate and the country has been
witnessing resistance. Though in the beginning when privatisation is a part of the economic
liberalisation scheme, the nation was dormant; however, much resistance arose when the
intricacies in privatisation were found (Kapur & Ramamurti, 2002). However, previous
01
a
64 an
012).
ys
ugh in
pe
rose a
per ntage
ee
ith t
mid-198
and the tes war
in 2001 and t per
n th year
f stu
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aid pri
0s w
educa
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institut
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ing nom
past
ay
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s (20,390 col
h transf ms India as
titutions nka
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researchers also argue the benefits of privatisation of Higher education in India wherein
previous studies and reports claim privatisation in other developed and developed countries to
be a great success. Feith (2012) projected the market for international higher education and
claims that the demand for higher education will surpass China. The previous researcher
argues that market driven policies can only meet the increasing demands of higher education
in India. Hence, the present section intends to analyse the present status of privatization in a
broad context envisioning the role of privatisation all over the world and its impact in the
educational system. Further narrowing the topic towards the impact of privatisation in
educational system of India, previous literatures pertaining to the context of the present study
will be reviewed and analysed.
2.1 Defining the terms
Privatisation
Privatisation is the fundamental part of the public reforms and is the core theme
towards enhancing the efforts of the private sector. For most countries in the world,
privatisation is the key to development in all aspects; however, the objectives of the countries
differ based on the capabilities and the need for privatisation in these companies. Though the
privatisation objectives of each country differ based on the needs and capability, depending
on the development and the social goals of the country, the following factors are considered
and the private sector should operate to serve the cause: improve efficiency, improve
customer/ consumer choice, increased competition, mitigation of public debts and budget
deficits, and extending the share ownership in the private sector. However, all these factors
on the whole should aid with enhancing the productivity and efficiency of a nation, thereby
acting as the growth engine of a nation’s economy(Ddumba-Ssentamu & Mugume, 2001).
Furthermore, Privatisation is also defined as the process of increasing the productivity
and efficiency of the private sector thereby fostering the development of the private sector
(Naya, 1990). However, in simple economic terms, privatisation is the transfer of the
activities of the state to the private sector which occurs in partial or whole, or by the sales of
assets which is followed by liquidation (Ddumba-Ssentamu & Mugume, 2001). In terms of
higher education in India, privatisation is the only feasible way to increase the Gross
enrolment ratio (GER) of students in higher education wherein a minimum of 30 per cent
GER could be achieved with the establishment of additional 800 universities and 40000
01
a
the pr
owe
to ththt e privat
uid
pri
tisation
sec r there
mpmpm le nom
sec
ship in
he produrodurod
a nation’s onomy(m(my(yDyDy d
o de ed as
y fofof s
erve th
petit mit
the privat
ivity
ba
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tion pububu
r. Ho
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e nee and
lowin
ove efffff ifif ci
li
d is core
co es in th w
ctive f th countrie
nies. Tho
dep
heme
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private colleges within 2020 (Gupta & Gupt, 2012). Hence, privatisation especially in higher
education in Indian is seen to provide better accountability and quality of educational
experience for the students therefore these institutions are more sought after for admission by
students than government run institutions
Liberalisation and privatisation
Liberalisation is defined as the transformation of market structures which is facilitated
by the responses of companies and new entrants into open/ free market. In a liberal economy,
the shares of the market transform are liable to change rapidly, and the competitive scenarios
between small and large scale firms determine the growth of this market, whether the
concentration will be more or less (Kambhampati & Kattuman, 2003). Over three decades,
developed and developing economies have been witnessing privatisation of public sector
services. The recommendations of the International Monetary Fund (IMF) and the World
Bank are towards the privatisation of public owned enterprises which is a suggestion to
increase revenue, enhance the health of public finance, increase the productivity and
efficiency, thereby reducing the intervention of government (Megginson & Netter, 2001).
Among the different aims of privatisation of public enterprises and services (Villalonga,
2000; Sheshinski, 2003), the predominant goal of privatisation is to increase the efficiency
and productivity of the economy (Kilicaslan et al., 2008).
Globalisation
The process of Globalisation is still in stages of integrating the nations all across the
globe and is related with the concepts of privatisation. Following several changes in the pace
of technological developments, economic liberalisation, and the importance of international
laws, national economies are evolving continuously and globalisation has delivered these
countries into a state of competition which is very different before liberalisation in developed
and developing economies. The term ‘Globalisation’ is not a sudden trend in the global
market. It is the sustainment of developmental activities in the economies of different nations
and is still in its developmental stages. Liberalisation of economic activities in a country
differs from one another with economic agents which are connected on marginal basis and
are resistive towards failure in the neighbourhood nations. Immediately after the post-World
war-II period, the rapid growth in the developments of foreign trade is embraced by
developed nation in the 1950s and 1960s; however, Foreign Direct Investments (FDI) in
001
a
onom
usta
velopmental
econ
in th
mpmpm etitio
The term G
develo nta
tag
till
privatisati
econo ber lisat
lving conti uou y an
hich i ery diff
balis
tage f in
on. Fol
and
ating the
ise
sation
nd
ugg
e prod tivity
gginso & Netter, 2001)
service (Vil longa
the efffff ifif
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developing economies paved way for globalisation. Over the past two decades, trade and
economic liberalisation improved the economies in the world, thereby integrating the world
into a highly integrated system. Following are the three predominant features of globalisation
steering the integration of global economies.
i) Product internationalisation with changes in the production structure
ii) International trade expansion
iii) Expansion of international capital flows (Mrak, 2000).
The Article 25 of the Companies Registration Act defines the establishment of
educational institutions in India which can only be set up by trusts and charitable
organisations. However, the act lacks clarity about foreign universities setting up in India.
The government of India is adopting liberalisation policies to allow foreign investors
establishing private educational institutions in the nation (Amandeep, 2016). Similar to the
studies by Kilicaslan et al., (2008) and Megginson & Netter, (2001), the government of India
attempts to liberalise its policies on foreign investment and privatisation in order to improve
the economy.
2.2 Relationship between Liberalisation, Privatisation and Globalisation
There is specifically a relationship existing between the three factors: Liberalisation,
Privatisation and Globalisation (LPG). Boubakri et al. (2011) argues that there exists a
relationship between liberalisation and globalisation, and privatisation. The researcher argues
that privatisation has profound effects on globalisation as increasing the participation of
private sector in foreign investments thereby promoting capital inflow, technology and
management skills of the company. Since globalisation turns the market environment more
competitive, the GDP growth is also enhanced. In the same context, Goyal (2006)
investigated the role of globalisation on developing countries with special reference to India.
Over the years, the integration of societies and economies has been a debatable topic.
Developing economies like China and India witnessed tremendous growth after adopting the
model of Liberalisation, Privatisation and Globalisation and the rate of poverty in these
nations declined steadily (LPG). However, globalisation has been controversial since a
number of oppositions internationally were generated based on inequality and degradation of
environment. This necessitated the study of impacts of globalisation in developing nations
from the perspectives of FDI. After the foreign exchange crunch which dragged the economy
rs, the
ono
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dia.
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to loan defaults, India opened up its market in the early 1990s. As a response to the economic
liberalisation, a number of foreign investment companies established their businesses in the
nation. The policy changes invoked a more open market economy. Goyal (2006) further
argues that the Government of India should analyse the best opportunities within the
globalisation and privatisation schemes since the target of the world is towards developing
countries such as India and China. The US and the countries of Europe are defined
economies, hence economic experts argue that India and China may overtake the US and
European countries thereby becoming a major economic power in the forthcoming decade
(Goyal, 2006). The technological revolution which is coupled with the processes of
liberalization, privatization and globalization (LPG) has transformed knowledge as the key
basis for nations to compete in the global environment. The emergence of the knowledge
based society has further accomplished several economic benefits of developed and
developing countries for which researchers claim the reason to be the LPG model. Education
and globalisation are mutually dependent terms. Globalisation is the process of imparting
efficiency and competitiveness and in the educational sector, it means transforming
knowledge into an ‘accessible to all’ resource(Rani, 2010) . Ray (2015) states that with the
new policy reforms associated with the liberalisation, privatisation and globalisation schemes,
the science and technology wing of India has witness rapid growth, enabling increased
enrolment in higher education thereby increasing the knowledge base for IT and skilled
labour force.
According to Gautam et al. (2015), the LPG model has influenced almost all the
sectors in India and the higher education wing is no longer an exception. The Government of
India claims privatisation as the most feasible mode to satiate the growing need for higher
education in India. This will be reflected in the following sections wherein the role of
privatisation in educational sector both in developed and developing countries are elucidated
following which the context of LPG in Indian higher education is expatiated.
2.3 Privatisation in the educational sector
In broad terms, privatisation in the educational sector is referred to as the policies
which promote liberalisation and deregulation thereby establishing a market in education or
creation of a competitive environment between private and public education providers
(Lubienski, 2006). Different countries identify privatisation to increase the efficiency of the
educational system in two ways.
sat
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ledg
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i. Delivering education to the inaccessible communities
ii. Improving the quality of education thereby nurturing competition
Though the governing bodies of countries view education as a public good to the
population, privatisation of the education sector enables the equilibrium between the
education provider and the choice of the consumer. In a private institution, the type of
product offered and the fee for these products are fixed by the private education providers. In
a privatised educational setup, the consumers of the education as good (parents and students)
will possess the option to decide the type of education and the charge that they wish to spend.
Instead of standardising education through free state education, private owners feel the need
to satisfy the educational needs of the consumers. Additionally, the profit motives are set by
these private education providers. An implication of privatisation is that there will be a
remarkable growth in the generation of quality assurance and national assessment systems
which seek to enhance the information quality thereby creating better choices for consumers
(Benveniste, 2002).
Privatisation in the educational sector is unfolded in three ways. The three ways are:
i. Outsourcing state specific activities and operations to private education providers.
ii. The introduction of self-regulatory and market-based regulations which forms the
deregulation of the education sector
iii. Provisions for educational institutions which are either funded by the state with the
regulations of the public or independently.
All the aforementioned approaches could be considered either simultaneously or
balancing each other or may even on one of the three modes. Some approaches are
independent; however some complement each other. For instance, the emergence of more
private educational institutions and at the same time these institutions offering more choices
for enrolment in these institutions. In developed countries, privatisation of education sector is
encouraged for the growth of education in these countries. These countries offer vouchers to
encourage student enrolment in private institutions, and tax credits to parents (Belfield &
Levin, 2002). However, this is not feasible as in the case of developing countries wherein
there will be no possibility for the Government to fund and encourage private education
which limits the philanthropic scope of privatisation in developing countries (Pedró et al.,
2015).
in the
or th
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titutut tions
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a
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The Global education 20/20 report (Economist Intelligence Unit, 2009) claims the
role of private sector in education. In this regard, 211 respondents were surveyed wherein 123
respondents belonged to the private sector companies and 88 from educational sector. The
survey was conducted by Economist Intelligence Unit in February 2009 which discerned the
role played by the private sector and analysed whether the same regulates positively or
negatively the traditional education. The survey covered questions regarding the importance
of privatisation in the educational sector wherein 70 per cent of the respondents revealed such
privatisation to be important. However, the role of the private sector varies from country to
country. The survey further revealed the success of voucher-system wherein the system
increases the performance of the schools (The Economist, 2007). In Sweden, higher
education for students belonging to the EU nations and Switzerland is provided free of cost
which is facilitated by tax revenue (Swedish Institute, 2013). In Portugal, the United States
and Japan, private institutions are funded by the state and mostly serve as not-for profit
organisations. In Japan, around 77 per cent enrolled in private institutions delivering higher
education (Varghese, 2012). However, not all countries allow the privatisation of educational
sector, and not all corporations aspire to do so. The report further reveals the emergence of
private corporations taking care of the education sector all around the world. Based on the
results of the survey, it is deemed that privatisation in the education sector is important since
the idea of the respondents is privatisation brings better education (Economist Intelligence
Unit, 2009).
2.4 Privatisation of higher education in Global context
A shining example of a well-established system of higher education that is both
qualitative, diversified and available to all sections of society is the one prevailing in the U.S.
The private sector is a major contributor to the system at various levels. But the private
sector's role is generally limited management and philanthropy. Though there is great
diversity among universities and colleges, the fees of students constitute lesser than 50% of
the total capital budget and operating costs. Donations, royalties, research grants, licensing,
and auxiliary services account for the remaining (Sunder, 2010).
Many nations (for instance, the United States) have a chequered past of development
of the private sector. In most of the other nations (for instance, Latin American nations), the
private sector came on the scene more than five decades ago but significant growth was
achieved during the very end of the 20th century. In various regions of the world (for
ng un
al b
ices account
for inst
a
ally lim
ties d coll
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deli
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is impmpm o
United Stat
not fifif t
ring
cational
higher
cost
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instance, African and post-communist European nations), the private education sector is
relatively new. Proprietary institutions, for-profit and non-profit organisations comprise the
private sector. Institutions that are proprietary —characterised by profit-seeking behaviour
and driven by the market driven, with centralized and business like management systems, in
addition to a weak academic culture—can be defined as the pure form of privatization
(Holzhacker et al., 2009). In the United States there have been many private, not for profit
higher education institutions for many years like Stanford University, Massachusetts Institute
of Technology etc. On the other hand, the University of Phoenix in the U.S. is private and for
profit. There are many private providers in the UK higher education which function on a not
for profit basis (Shankar, 2016).
The share of higher education in the entire world accounts to 31 per cent with the
highest share of 35 per cent of students enrolled in the private higher education institutions of
Asia and the pacific. About 50 per cent of the institutions in most of the regions of Asia and
the pacific belong to the private sector. When compared with the number of enrolment in the
public institutions, the growth of enrolments in the private education sector is phenomenal.
Countries all across Asia enacted regulations and policies to manage private higher education
institutions; however the issues based on quality of education, the equitability towards
education access and the affordability of students towards paying for private institutions are
challenging for developing countries (Asian Development Bank, 2012).
Three stages of private sector emergence into the educational sector are elucidated by
Geiger (1986). The three stages are peripheral private, parallel public and private education
sectors and the extensive private higher education sector. In the peripheral private stage, a
country’s public higher education sector will dominate and the role of private higher
education institutions will be peripheral. Developing countries normally adopt the peripheral
private model where the countries are deeply rooted in socialistic principles. Developing
countries such as Viet Nam and the Central Asian republics fall into this category. Secondly,
the parallel public and private higher education sectors are a reflection of higher education
institutions operating in parallel. The examples of countries adopting such system are Hong
Kong, China, Malaysia, and Thailand (Chealy, 2006). Thirdly, the extensive private higher
education sector is the combination of more number of private educational institutions and
the high degree of enrolment in private higher education institutions. The Republic of Korea
and Japan are the leading countries with high share of private higher education enrolment in
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the East Asia (more than 77 per cent of enrolment shares and 90 per cent of institutional
shares), following which Indonesia and Philippines with 70.9 per cent and 60.9 per cent
shares in private higher education enrolment and 97.3% and 72.2% shares in private
institutional number respectively (Asian Development Bank, 2012).
Figure 2: Private Enrollment and Institutional Share in Higher Education in Selected
Asian Economies, 2002–2009
Source: Adopted from Asian Development Bank (2012)
From Figure 1, it is evident that the number of private educational institutions and the
share of private higher education enrolment in India are somewhat not in line with the
developments of other countries. Though India is the second populous country, the number of
enrolments is lower than the other Asian nations such as China, Phillipines and Korea.
However, the Gross Enrolment Ratio (GER) for higher education (in general to both public
and private sector institutions) has doubled over the decade wherein the GER is 9 per cent in
the year 2002-03 and the same is 24 per cent in 2013-14. Shankar (2016) relates such
enrolment to be associated with the emergence of private higher education institutions which
remarkably increased the higher education enrolment rate of students.
0
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2.5 Privatisation in the Indian educational sector
Despite the fact that many nations including the United States view private sector as
philanthropic, the same cannot be stated in the context of India. In sharp contrast to the
definition, genuine not-for-profit colleges or educational institutions in India obtain nearly
100% of their total income from fees collected from students, since income from other
avenues is less. Whereas in educational institutions/colleges that are set up as for-profit;
either by overt admission or discreet actions; the total fees collected from students is enough
to cater to all the overheads and also generate a return on investment. Since very little
benefits are available for innovation, research, and doctoral education, the financial model
comes in the way of improving the quality of education that has been provided by institutions
comprising a major part of the increase in admissions (Sunder, 2010).
In terms of number of students, the Indian ranking in higher education system is
number three, behind China and the United States. However, the advantage in India is that
English has primacy as the main language for higher education and research. Comparatively
11 per cent of India youth complete higher education against 20 per cent in China. The
important governing body with overall regulatory control of universities is the University
Grants Commission (India), which ensures compliance of standards, acts as an advisor to the
government, and liaises between the centre and states. Higher learning in India is
accomplished through Universities and constituent colleges. As on 2011, around 227
Universities are available in India that is recognised by the Government which includes 11
Open universities, 109 deemed Universities, 20 Central varsities and 87 state universities. A
majority of the varsities in India have colleges affiliated to them where undergraduate courses
are conducted (Singh, 2009).
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Figure 3: Total number of Private aided, unaided and government higher education
institutions in India (State-wise)
Source: Adopted from Ministry of Human Resource Development (2015)
Elementary and secondary education is imparted in schools in India, while the third
level i.e. higher education is provided in colleges and universities. The education sector has
0 5000 10000 15000 20000 25000 30000 35000
Andaman & Nicobar Islands
Andhra Pradesh
Arunachal Pradesh
Assam
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Daman & Diu
Delhi
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two types of providers - private and public. Private institutions are classified into two types -
aided (partly bankrolled by the government) or unaided (self-funded). Public institutions are
setup, bankrolled and entirely managed by the concerned department of the government.
Whenever the government's efforts to impart education in a manner so as to be accessible to
all, falls short of the planned target, the private sector steps in to fill the gaps. The generally
accepted norms is that motivation for the private sector is profit, however, when the private
sector is involved in education, profit should not be the driving force. Experts opine that
particular private sector players in the education sector lower the standards of education as
they do not adhere to the laid down norms, and preclude certain categories of students due to
the inexorbitant fee structure. But, the contrary view held by few experts is that private sector
involvement is a necessity to improve quality with added investment, to encourage
competition in higher education (Shankar, 2016).
Figure 4: Total number of Private aided, private unaided and government higher
education institutions in India (total)
Source: Adopted from Ministry of Human Resource Development (2015)
Despite the progress made in education after decades of independence, higher
education in India requires to perform better in the crucial areas of Access, Equity and
Quality. Sudarshan & Subramanian, (2012) are of the view that imparting qualitative, higher
education that matches global standards at a reasonable cost is one of the most important
issues before the nation. They further state that if India does not take appropriate steps on a
war footing, then the situation would turn grim wherein a large number of youngsters would
Indian Higher education colleges
Private Un-Aided
Private aided
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be looking for higher education and the system will be unable to accommodate all of them.
People in the age group of 15-35 years estimated in the year 2010 to be more than 350
million, is projected to peak at around 485 million in 2030 (Altbach & Jayaram, 2010). To
complicate matters further, the higher education Gross Enrolment Rations (GERs) shows
disparity among states, urban areas, rural areas, gender and communities. As per statistics of
Ernst and Young (2009), urban areas have a GER of 23.8 per cent whereas in rural areas it is
a dismal 7.5 per cent. Delhi has a GER of 31.9 per cent while Assam is at the bottom rung
with 8.3 per cent. The rich–poor and the rural–urban gap witnessed in India has serious
detrimental effects. The best way to narrow the gap would have been to utilise education to
bridge the divide. But, as can be witnessed from the statistics, the disparities are pronounced
when it comes to uniform access to education to all, which only ends up highlighting the
divisions seen in society. The main reasons for the sorry state of affairs is an outdated
curriculum, undue emphasis on theory, diluted focus on research and social sciences,
indifferent attitude towards innovation, low morale and lack of motivation among teachers
and researchers and the lack of a proper monitoring and regulatory mechanism. Therefore,
when the National Association of Software and Service Companies, (2005) tabled the facts
that only 25 per cent technical and 10 per cent non-technical graduates were of employable
standards, it was not far from the truth. One more fact in support of this report was the
practice in most companies that recruited fresh graduates, trained them to bridge the gap
between the requirements of the industry and the actual output passing out of educational
institutions. This was done at heavy cost to the industry, pointing to the disconnect between
education industry standards.
It is not feasible for the government to cater to all the higher educational requirements
of India. This could be because the allocated public expenditure on higher education as a
percentage of Gross Domestic Product (GDP) is a mere 0.6 per cent (Ernst & Young, 2009a);
this is quite lower than what developed nations like the United States (US), the United
Kingdom (UK) and China allocate on a per-student basis. In order to fulfil the demanding
needs of a dynamic economy, private entities have established institutions to supplement
public educational institutions that are beset with problems of meeting capacity. Professional
or higher educational courses like engineering and Master of Business Administration (MBA)
has attracted a lot of privatisation efforts, constituting a majority of the total courses on offer.
The courses and institutes of private sector in pharmacy and engineering are a staggering 90
percent of the total institutes and courses. The data is ample proof that private enterprise in
01
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education is now a vital part of the education scenario which cannot be reversed. Critics who
hold the view that education is a social necessity best handled solely by the Government will
be unable to offer a solution to the challenges faced by higher education, in the context of the
scale and complex nature, which cannot be handled by the government alone with the
resources at disposal(Sudarshan & Subramanian, 2012).
Reformist policies of Liberalization, Privatization and Globalization (ins short - LPG)
ushered in sweeping changes resulting in the emergence of India as a powerhouse of educated
manpower with more than thirty thousand institutions imparting education to around twenty
million enrolled students (Gautam et al., 2015). Since then, the government has attempted
investments to increase capacity and to improve the existing infrastructure. The time has
come to credit the private sector with the supporting and at times leading role played in the
phenomenal success in higher education in India, since a vast majority of students are
presently undergoing courses in private institutions.
With the Government of India, UGC and AICTE welcoming private enterprise in the
education domain, high and sustained growth can be predicted. The government needs to
encourage privatization of higher education by concentrating on the qualitative aspect of
colleges. Visible changes are observed in higher education in India, and the perception of
private sector participation has changed from one of suspicion to an accepted and appreciated
facet. The Program of Action, 1992 and the National Policy of Education (NPE), 1986 are
policies that control higher education in its present form. The National Policy of higher
education in India was framed on the basis of the Radhakrishnan Commission Report (1948‐
1949) and the Kothari Commission Report (1964‐1966) (Partima & Singh, 2014).
2.6 Indian government policies on privatisation of Higher education
The augmentation of higher education has been viewed sceptically and the rationale
has been questioned, viewed in the context of related academic and social costs. However,
the government is refusing to budge from its earlier assurance, considered as the fulfilment of
nationalist ideals and as an intrinsic part of its fundamental responsibility as a welfare state.
View prudently, government recognition of the people's desire for higher education means
that restricting access would be detrimental. This is also influenced to a large extent by the
desire to have enrolments comparable to that in North America and Europe. This desire is
lent support by the repeated reports of World Bank that highlight the benefits of higher
01
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education. It also conforms to the government view that by enhancing profile of its populace,
the disillusionment in society as a result of underemployment and unemployment can be
contained. But, in the face of public demand and the pressures of politics seeking the
accomplishment of standardisation of primary school education (which should have been
achieved before the end of the Second Five Year Plan, in the year 1961), the government has
concluded that continuation of subsidisation of higher education which has been the practice
for last 5 decades is no longer tenable. Simultaneously, one segment of the population can
afford prohibitive costs of higher education facilities offered by a few private institutions and
by foreign universities. Hence, the government is regarding privatization. But, it is
apprehensive on two counts. The first and foremost is that there would be disparity among
those can afford to pay more and those who would not be able to afford. The second is that
commercialisation of higher education could progress to a level where it transforms itself into
one that is entirely market driven.
Hence, the government intends to extend the system that is in practice in many states
for the last ten years. A vast number of institutions of higher education have been established
and managed by private entities. A sizeable proportion of such institutes are run with funds
from the government, classified as “aided” and these funds take care of maintenance and
operational costs. Irrespective of their status as aided or unaided, private institutions without
exception charge fees identical in structure and amount. Additionally, in all matters
pertaining to administration and academics, all institutes are regulated by the rules of the
government and university. In accordance with the system followed in a few states, as
mentioned earlier, a chosen few and new private unaided institutions are permitted to fix a fee
structure that is substantially higher than others. But, the fee structure can be fixed only after
approval by the appropriate authority in government. The chosen institutions are granted
leeway in certain matters pertaining to administration. However, overall, they are
administered in similar manner as other institutions. It is inappropriate that India is
contemplating acceptance of this type of privatization; where flexibility, space, and academic
liberty for the progress of knowledge, quality and relevance are not encouraged, but stifled
(P. G. Altbach & P. M. Petersoneds. , 1999).
Privatisation of higher education in India takes several forms (Tilak & Varghese,
1983b):
i. Government introduces self-financing courses within the public institutions
01
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ii. Public government institutions converted into private institutions
iii. Government allows self-financing private institutions with and without
recognition/ allowing commercial education institutions
The feasible form for private players in the field of education is to engage in the
establishment of private universities, deemed universities and academic institutions (Jonaki &
Prasenjit, 2016).
Establishment of private universities
A university should be a trust or society. It should not be an entity for profit or it
should not be run by a trust for profit. There are two ways to establish a private university. It
can either be set up by an Act of Parliament (central university) or by an Act of a state
legislature (state university). Till today no private university has been set up by an Act of
Parliament. In the other method a university is being declared a deemed university. There are
currently 229 privately managed universities in India. Different states may have different
land norms and other procedure for setting up a private university. The analysis of such laws
in the states such as Rajasthan, Madhya Pradesh and Gujarat shows that these requirements
are more or less similar across states (Shankar, 2016).
Dissertation Sample
01
a
at sh
p by
uni y. T
may hav dif
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rsity
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it
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Figure 5: Procedure to establish a private university
Source: Adopted from (Shankar, 2016)
Regulations
The UGC reserves the powers regarding the recognition, functioning and de-
recognition of deemed universities. It also has the powers to distribute grants to other
universities for their maintenance and development and regulating fees charged by the
universities. If colleges or universities fail to comply with UGC standards their grants may be
withdrawn or their affiliation may be terminated. Such disciplinary actions will be taken of a
college or university does not comply with fee other regulations (University Grants
Commission, 2002). Private universities which offer technical courses like engineering, town
planning, management and which receive funds from AICTE should adhere to its academic
standards and regulations (MHRD, 2016).
In order to give recommendations on building a knowledge base in India the National
Knowledge Commission (NKC) was set up in 2005. The reforms required in the education
sector were also considered while setting it up. Educational institutions for profit were not
encouraged by NKC. 3 In 2008 the Yashpal committee was set up in order to recommend
changes in the higher education sector. The important suggestion of the committee was that
Project report or
Proposal
• Project report/proposal with five years expected cash flow Statement, Letter of Intent and Initial sum of money
submitted to the Government.
• Proposal Contains: Objectives of the University, types of Programmes of study, deed of the Institution (Which is
a Trust/Society/Non-Profit entity under Section 25 of the Companies Act, or is being run by one), fee Structure,
admissions format Composition details of board of Governors, Availability of academic research and Training
facilities, building plan and land deed, etc.
Setting up the
University
• Once the Proposal is Approved, the State Government Tables the Bill of the Establishment of the Private
University, for Passage by the State Legislature.
Regulation
• The university shall maintain standards as prescribed by the relevant regulator (UGC, Except in the case of
technical, professional courses: AICTE or other councils).
• It shall get accredited by a body such as the National Assessment and Accreditation Council, within a Stipulated
Period of Time.
001
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higher education should not get fascinated by the motive of profit. 4 Both NKC and Yashpal
committee recommended private investment in higher education to extend educational
opportunities. It is further discussed in detail with regard to the issue of access under fee
structures.
Private providers always have a profit motive associated with them. The Supreme
Court of India, lately, interpreted that the nature of educational institutions to be charitable
and not for profit. Hence, by providing education supernormal or illegal profits cannot be
made. If surplus revenue is generated it should be used for expansion of the institution and
for education development.
2.7 Issues in Privatisation of higher education in India
The major developments in the higher education wing of Indian education sector
started in the early 1990s with the laws enacted to enable open/ free market. Tilak (1999)
states that there is a need for higher education to be privatised and the public funding for such
education should be reduced. The Government of India in the year 1997 distinguished the
two categories of education in India- elementary education as ‘merit-good’ (Musgrave, 1959)
and ‘higher education’ as non-merit good. However, the Ministry of Finance classified higher
education as a ‘meritII good’ and which needs no subsidisation as the same level as the
‘merit good’.
In India, privatisation of higher education had always been controversial. In the year
1992, the Supreme Court which is the highest judicial court in the country banned ‘Capitation
fee colleges’ stating that charging fee is unfair.However, the court reversed the judgement in
the year 1993 stating that these colleges could be named self-financing colleges. This led to
the emergence of private self-financing capitation fee colleges all across the country and the
proliferation led to more number of private institutions established in the nation. It is evident
in the states of Andhra Pradesh and Karnataka that the number of private colleges
(engineering and management) outnumbers the public educational institutions. In recent
years, the number of private educational institutions and the enrolment of students in these
institutions have increased wherein the share of private enrolment in 2000-01 is 32.89 per
cent and the share rose up to 58.5 per cent in 2011-12 (Jahan & Selvarani, 2015). During the
11th
plan, India witnessed a predominant growth in the number of private institutions wherein
the number of private state universities is 98, 17 private deemed universities and 3581 private
of A
nd m ag
f te e
whe
ate
e numbmbm er
Pr esh an
nt) b
duca
e high
is unfafaf
ese colleg cou d be
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priva instit
Ka
duca had
t jud cial
Howe
med
lway en
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n
e Mi
ubsid satio
con
ket.
publi ndin
yea 1997 distinguis
good (Mu ave, 1959)
ce classif
cat tor
Tilak
forforf su
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diploma institutions and 7818 private colleges. Even the number of private arts and science
colleges has increased in the recent years (Jahan & Selvarani, 2015). However, such
enormous proliferation rate in the number of private institutes poses serious doubts on the
quality of education rendered by these institutes (Kaul, 2006). Aleem et al. (2016) claims that
commercialisation and privatisation in higher education will pose serious threats to the
development of human resources in two ways- expensive cost of education leading to
unequal deliverance of education, and determination of education priorities. While
privatisation in education sector have been allowed in countries like China and Singapore
with flourishing higher education stats, the same should be feasible even in the Indian context
which is the premise of the present study.
2.8 Need for Privatisation in higher education
There are several requirements, which could be mapped with the privatisation of
higher education in India. Less than 1 per cent of the nation’s GDP is funded by the central
government of India for education. The capacity building strategies of the government could
not satiate the needs of higher education in the nation. By the year 2013, the number of
students enrolled for higher education is 14.6 million and the FICCI-E&Y report FICCI
(2011) states that in order to achieve 30 per cent GER in the forthcoming decade, the country
would require building a capacity of 25 million seats. However, predicting the extra capacity
building cost, by 2020, an additional 10 lakh crores (in Indian rupees) will be required for the
government with a funding requirement of Rs. 4 lakhs per seat. In the current Indian context,
such allocation of resources for higher education would be infeasible. Hence, private sectors
play a vital role in bridging the gap between the requirement and the budget. The positive
contribution of private sector players towards higher education is evident from the success of
economies like Japan, the US and Malaysia. The GER of the US increased from 71 per cent
in 1999 to 83 per cent in 2008 whereas in Japan, the rate increased from 45 per cent to 58 per
cent. In Malaysia, the rate increased from 28 per cent to 32 per cent (Tiwari et al., 2013).
In India, Liberalisation, Globalisation and Privatisation play significant role in
improving the quality of India corporates. The economic reformation allows foreign players
into the nation, thereby creating a competitive environment between the foreign private
players and the indigenous players. The low cost of living and India being the large English
speaking base next to the US enable the country to act as the higher education hub in the
Asian continent (Tiwari et al., 2013).
ysia t
ia Liberalisa
ndia
by cre
, t
in 2008
e in ased fr
ion,
co
gher e
betwee
or playe wards hig
and Malaysia. e G
reas Japapa an
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P is nded
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CCI-E&Y rt
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While researchers argued several needs for privatisation in the education sector,
Jonaki and Prasenjit (2016) combines all the need factors which are as follows:
i. Increasing the efficiency of the public sector by enabling competition
ii. With the rapid growth in the population, the country’s ever-growing needs for
education could be satiated with the aid of private sector institutions.
iii. While Government funds were considerably allocated to the higher education wing,
private sector institutions may reduce the financial burden on the government.
iv. Reducing the decentralisation of educational institutions
v. Improved quality of education and training which aids in nurturing youth of the
nation thereby sufficing the local, national and global manpower needs.
vi. need for skilled and expertise man-power is increasing day by day. Since the
country adopts the LPG model (Liberalisation, Privatisation and Globalisation), the
global needs for manpower should also be met
vii. Facilitation of technological developments and economic developments in India.
With the new economic policies (LPG policies) that emerged in the early 1990s
(Tilak, 2009), privatisation has been given predominant importance. However, privatisation
has affected the poor communities in India drastically since there is an inequity in the
deliverance of education across all the levels of the society and the openness and diversity of
the knowledge providers are questioned which includes the quality and price of the product
(education and knowledge) (Jonaki & Prasenjit, 2016).
2.9 Political economy of higher education in India
The tightly controlled structure of the Indian higher education sector was analysed by
Kapur and Mehtaa (2007). The paper has a two-fold key argument. The first argument is that
higher education in India is de facto privatized on a large scale.2 This privatization did not
happen because of the changing preferences of the key factors like the state, the judiciary or
the propertied classes in India. Instead, this privatization took place from a breakdown of the
state system. Consequently, ideological and institutional underpinnings are very weak in this
form of privatization. Much of the private initiative remains within the bounds of the
gh
htaa (2007). T
de
hangi
my of h
led strurur re of
he p
f
he lev
q ed which
(Jonaki & sen t 2016)
her ed cati
en predo
India asti
of the so
includ
G pol
inan
ly si ce th
nd t
nd e
that
tance. Ho
ne
day day
sa nd Glob lisa
ents in
g youth of t
s.
Since
) the
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discretionary actions of the state instead of being a part of a comprehensive program of
education reform. As a result, the education system is stuck between over-regulation by the
state and a discretionary privatization which is not able to mobilize private capital in useful
ways. Any policy intervention will have to change this political economy equilibrium if it has
to succeed. Irrespective of the fact whether an institution is public or private, there are vicious
circles of interest which hamper reform.
Since some of the most renowned modern universities in India are established by
some of the dedicated individuals with private financial help, the private initiative in higher
education is not a new concept in India. This sort of public private partnership was unique in
India (Levi, 1994, p313). In the initial stage the concept of private institution was meant to be
arbitrary. It was also a comparative category to express various classes of educational
institutions. In the domain of philanthropy such an arbitrary term gained image from its
inception without much complexity and became a normative language (Cotton, 1999, p566-
567). The fact that the public supported private institutions made the understanding of
philanthropy easy. The policy of grand-in-aid system was made operational during British
rule with the instructions of East India Company to encourage private institutions. Three
types of private institutions- nationalist, sectarians and caste communities. They were
functioning with the support of individual philanthropist and local notables before
independence. Private sector continued to be a major domain in shaping higher education
system in the post-independence India with the constitutional provision. Such strong support
from the history led to the substantial growth of private higher education institutions which
constitute three-fourth of the total education institutions. Private institutions are of two types-
aided and unaided. Aided institutions are privately managed and publicly funded, whereas
unaided institutions are both privately managed and funded colleges. In the initial stages of
independence the role of private initiative in higher learning education has been very crucial.
Many of the private educational institutions were reported to be non-viable and mediocre.
The poor quality of delivery in their services and inadequate enrolment rates of students
largely caused such an outcome (Garg, 1977; Kulandaiswamy, 2005). The private aided
educational institutions were to strictly abide by the statue of the concerned universities.
Since they regularly received aid financial aid from the state, private aided institutions did not
have a significant role in sharing the cost of education (Tilak, 1992). Though the state has
authority over affiliation, pattern of aiding and regulation of education it failed to keep the
constitutional promises of social justice. The managements executed and enjoyed their
ality
such an ou
re
eived a
of pr
ducational
ery in their se
om
o s
ducatio
st are priv
privately ana d an
initia ive in high
ituti w
rv
h the co
owtwtw h priv
nstitutio
ly m
fun
a maj
stitu
e hig edu
vate i
and
throp an
main
ovision. S
otto
e the der
de op ational d ring
rivate inst tions.
unities.
tabtabta
f educatio
mag its
199
nding
itish
e in
to b
al
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local/estate power with knowledge governing power and the dominant culture was silently
reproduced in the educational institutions.
Consequently these managements continued to remain as sectarian and partisan
organization of their own locality, community and organs of political parties. Besides this,
these institutions were instrumental in local politics to circulate among the party cadres and
supporters. Due to their affiliation with local political power structures, these managements
received under patronage and partisan prestige. The political elites, at the same time, make
governing rules of the system flexible. Combining local politics with governing power on
education institutions was, in a way, beneficial to both parties through nepotism, benefaction
and influence. A much more relaxed UGC rule made the process worse (Kumar, 2004;
Rudolph, 1972). Most of the private agencies had drawn from the elite sections of society.
The state of education continued to be governed by education itself. In the backdrop of mixed
economy in India system of education caused the growth of capitalism. Besides this, there
were 20 fake universities in India which were illegally operating in the country. The highest
number of fake universities was found in Uttar Pradesh (9) and Delhi (5) stood second
(University Grants Commission, 2006). The logic behind the emergence of these universities
is clear in the sense that there was a demand for the creation of new institutions. The fact that
they expanded private players in the education sector was not considered much. This trend,
probably, made the middle class indispensable in the private education sector since only the
middleclass can afford to buy education by paying a huge fee (Kapur & Mehta, 2007, p.35).
In the post-reform period the outgrowth of self-financing institutions saw a paradigmatic shift
in the higher education sector in India. By this trend the attention is drawn towards the
complexities of pedagogic practices and its wide range of social consequence. The discourses
on the privatization of higher education mainly among the developing nations suggest that
their commercial interest nearly tries to reduce education to a sheer commodity. In such a
context the state of education in India must be critically examined taking in to consideration
the political economy in general and education policy adjustments in particular (Babu, 2011).
2.10 Previous studies
Singh (2015) studied the effects of privatisation in the Indian higher education sector
and the issues and challenges associated with privatisation are investigated. India is one
among the largest countries in terms of population, geographical extent and the educational
system. The country’s educational system has grown rapidly over the year after its
con
tudies
died th
rest n
ation in In
ner l and educa
ndia. B
c d its wid
r educatio ma ly am
tries o reduce d
ia mus c
ti
y paying
f self anc
this tre
ange
ng
n th
hug
inst ions
atte
ation
was n con
e edu
Kapapa ururu & M
Besi
he cou y. T
and lhi (5) s ood
ence f the univer
tions. T
h T
s of soci
dro xed
s th
high
nd
tion
2004;
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independence. The number of educational institutions in India is also growing every year.
People in India could be generally classified into two categories: the ‘haves’ and the ‘have-
nots’. Singh (2015) argues that with a majority of people in India living below the poverty
line, privatisation of educational system is not a viable option. However, private players can
establish their role in the country with the country’s regulations serious about the welfare of
its people and the equity in education reaching all levels of the people living in the nation.
The increasing size of the demand and the growth in population clearly necessitates the need
for new private institutions which may provide quality education.
In the same context, Chougle (2014) analysed the perceptions of college faculty
members towards privatisation of higher education in India. The emergence of privatisation
was initiated in the year 1991 with the new policy enactment on Liberalization, Privatization
and Globalization (LPG). Over the last two decades, the policy changes have reflected both
positively and negatively on the welfare of people in the country. On a positive note, the
targeted change of increasing the number of higher education enrolment in India is achieved
with the support of the government. The country witnesses increased number of private
unsupported courses and the Government of India had been supporting privatisation.
However, privatisation is severely affecting the weaker section of the society wherein the
affordable population can pay for education and the ‘have-nots’ struggling to pursue higher
education. This increases the gap between the literate and the illiterate thereby increasing the
gap between the rich, middle class and the poor. In the previous study, teachers were survey
to understand their perceptions towards privatisation in Indian higher education sector. The
findings of the study revealed that the teachers believe in improved quality of education
delivered by private sector institutions; however, their concern towards the economically
backward students further revealed some part of the respondents stating their negative intent
towards privatisation. The previous study revealed that with privatisation, the educational
status of the country will be incremented to global standards. The study recommended that
with privatisation, the government should also look for additional measures to support the
economically backward communities without which inequity in education will increase
(Chougle, 2014).
Kumar (2014) investigated the role of privatisation of higher education in India with
special emphasis laid upon the Meerut, a city in Uttar Pradesh, India. The reality, as stated in
the previous study is that public resources are used for the expansion of private sector
1
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