Closing the Financing Gap in Higher Education: Investing in the Next Generation of Leaders

Unleashing the Power of Big Ideas: Higher Education Needs a Fatter Purse to Succeed!

By S Vaidhyasubramaniam

Our esteemed high school math mentor imparted valuable wisdom to us regarding the effective usage of the decimal point in numbers, a lesson that was brought to the forefront with the Union Budget for 2023–24. Although it received largely positive reviews, certain people were not pleased with the small percentage of GDP that was allocated towards educational services. This has been an issue of debate since 1966, when the Radhakrishnan Commission suggested 6 percent of the GDP be used for educational purposes; however, the current combination of the central and state governments’ input is still below the proposed figure.

In order to meet the other needs of the central government, such as defense, highways, ports, and electricity, a great deal of capacity is needed. Unfortunately, there is a huge financial deficit that stands in the way. The total grant from the Ministry of Education to all IITs amounts to nearly Rs 10,000 crore, making a 6 percent of GDP goal seem quite far-reaching.

Adding up non-ministry education grants may seem like income, but it’s still not enough to equal the top three Asian peers. Just look at the King Abdullah University of Science and Technology in Saudi Arabia—they were recently established with a whopping $3 billion, and they don’t even have to answer to the Ministry of Higher Education. Even if existing IoEs were converted to WCUs, it wouldn’t make much of a difference in terms of filling the financial gap and narrowing the quality gap. Crafting a strong financial roadmap is a must for IITs and other higher educational institutions alike if they want to stay competitive not just domestically but internationally as well.

The Standing Committee on Education, Women, Children, Youth, and Sports dropped a bombshell in its July 2022 report, recommending policies to craft “self-sustaining” and “self-generating” universities. This would require a creative and innovative overhaul of the financial architecture of the higher education ecosystem, with the necessary autonomy, regulatory framework, and growth-friendly environment in place to secure the necessary resources. It’s time to think outside the box. Money is essential for achieving the highest levels of quality and excellence in higher education, but so are the financial policies that shape it. Sure, big, bold ideas can take us far, but let’s not forget that it’s the finances that move us forward. We must be inventive in how we fund our universities and colleges if we want to see real progress. After all, it’s only with a full purse that we can truly make a difference.

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