Imagine this scenario in the future. The Union Budget was presented the day before. The university students are up in arms against against the imposition of Fringe Benefit Tax(FBT) on S-SOP( that's right its not ESOP, it is Students' Stock option). The Edusex (BSE index of the corporate universities) has plummeted by over 200 points. The worst hit are IIT Ltd. and IIM ltd. followed by umpty number of limited universities.
The students are fighting for their hard earned University shares to exempted from tax purview. Thats right, in the future University Ltd. wouldn't offer monetary scholarship alone, rather the scholarship is dispensed partly in stock options too.
Now we are not talking about some Hollywood gimmicks here. Corporate University is inevitable in the future to ensure an inclusive education for all. The National Knowledge Commission of India ( headed by Sam Pitroda) has remarked that over 1500 universities are needed In India by 2015 to achieve at least a 35% percent graduate literate population!!
If even for a meagre 35% level, a quantum leap of four folds is needed, imagine what would it to take to achieve a more respectable figure of 75 or 90%. Education is after all, universal. To implement this egalitarian vision, massive opportunities to pursue education must be created at rate matching the growth of population. The problem of limited universities can be tackled by universities limited.
But the fact is the government is cash starved to streamline the education. Even the school education is in dire need of re-structuring. A one percent levy,(announced in the last budget ) on taxes, is specifically meant for higher education.This is expected to yield only around 5000 crores. The majority of funds is disbursed as fees subsidies, staff salaries, infrastructure maintenance ,with little for research and development.
An undergraduate medical student in a Government college pays around a token sum Rs.2000/ as tuition fees or in a Government engineering colleges a student has to shell out
Rs. 5000 as semester fees ! Surely one cannot run a higher education system with such token fees. Subsidies are cash flows to drain with a bottomless depth. To make the government colleges efficient and truly global, the first thing that must be done, is to remove their dependency on the government coffers.
It is high time that the public is roped in to the industry of education. It may sound crass and unethical. but in reality it is the case. Profit motive is the driving force of any private institutions. The age of Guru- Shishia param para, is long gone. It is high time that the society perceives education as a profitable enterprise rather than a charitable endowment. Even hospitals are now corporate owned( e.g. Appollo , Fortis, Escorts etc.), so why not education?
The idea of universities going public, is mainly to generate the necessary capital to sustain the competitive edge and at the same time offer a more inclusive education for an ever increasing population. With the capital secured from equity issue, the company can embark on a modernisation drive.Being a listed entities, ensures that there is more transparency in University governance and regulations. (much better than the archaic and autocratic Trusts and societies that run them.) By going public, the society becomes a stake holder in the growth of the university. This in no way will dilute or debase the education service offered by the university. The only problem may be that the university must serve two regulators instead of one.( SEBI being one, and the other being AICTE/UGC/MCI)
The equity market in India has matured in recent times and more people are willing to invest in the stocks. The risk factors for a university are very low, as education service is an essential commodity in all times. But the questin that arises, is why would one want to invest in university stocks?
The answer to the question lies in the underlying premises that universities are centers of knowledge creation. Knowledge is power in tomorrow's scenario. In this case the consultancy, R and D inovations offered by the university is of great demand to the industry and the public. Professors and students alike can work towards this knowledge creation, and thereby earn more revenue for the university. Likewise the fees structure for students can also be reduced in the long run once the emphasis of university learning shifts from mere teaching to knowledge creation. The higher perks and salaries offered( on par with any competitive corporate entity) to the faculty might even induce the brighter brains to opt for a career in academia. On the part of the students a sense of collective responsibility and ownership might lead to superior performance, just like employee in a company.
I firmly believe going corporate is the best thing for our country educational needs. The government must explore the feasibility of bring this idea into practice. One may laugh at these proposals as being absurd or non-practical( like people did when Adam Smith's Wealth of Nations was published in 1757. Today we consider as Father of Modern Economics ). Perhaps in the future, ideas like these might usher in the radical change that could propel India into a superpower. After all any system that offers more number of seats at an affordable cost and improved quality is worth considering.