A New IIT Every Year

MANY institutions in India have gone downhill in the last fifty years. But the Indian Institutes of Technology are an exception. They are centres of excellence that are now recognised as world class. Their graduates are grabbed by multinationals the world over, and Silicon Valley teems with millionaires bred in the IITs. The infotech revolution which has suddenly made India a global player owes much to the IITs.

IIT alumni, many of whom have made fortunes in the USA, now want to do their bit for their country. Former students of IIT Bombay like Sudhakar Shenoy of the IMC Group plan to raise $ 150 million to upgrade facilities and faculty and lower fees in their alma mater. Kamal Rekhi, an infotech NRI who passionately wants to repay his debt to India, has talked of raising $ 900million to provide $ 150 million to each of the six IITs.

I am unable to join in the applause. The need of the hour is surely to expand the availability of IIT education, not to make a few ivory towers still more towering. Instead of making the existing IITs richer than ever, may I suggest that overseas Indians should set themselves a target of starting one new Indian Institute of Technology every year.

I have never ceased to be amazed and dismayed by the blithe refusal of top academic institutions to meet public demand. If Maruti Udyog finds a lot of demand for its products, it will open new assembly lines and new factories until it fully meets demand. But academic institutions do not follow the same policy of multiplying output to meet demand, save for rare exceptions like Delhi Public School.

Many academic institutions get huge donations from their alumni.

Yet they spend this sum on upgrading existing facilities, giving scholarships or lowering fees, not on expanding the availability of education.

Some institutions say that education is not like manufacturing: that in education, more means worse. I can only say that this constitutes managerial incompetence of a high order. Any newspaper editor who refuses to increase the number of editorial pages on the ground that he cannot keep up the quality deserves to be sacked. The same logic applies to heads of educational institutions. The real problem is that many top educational institutions are not interested in maximising public welfare by increasing output.

Rather, they seek to improve their exclusivity by deliberating producing less than what is demanded. The greater the artificial scarcity created, the greater is their prestige and status. This is by no means a problem of IITs alone: it applies equally to Harvard, Oxford and St Stephen’s College too. It is a problem of an academic mind-set which puts exclusivity over expanded availability. Some people argue that IIT fees are already so high that they cannot be afforded by many sections of society. The government is planning to reduce and perhaps ultimately end subsidies for IITs, in which case the fees could go up to well over one lakh rupees a year, maybe even Rs 2lakh if salaries of faculty are raised on par with private sector pay. The corpus of $ 150million per IIT being planned by NRIs would enable these institutions to carry on with highly subsidised fees that allow poorer students to join.

I am afraid this would be a dreadful waste of money. Any person who gains admission into an IIT has crossed such an important threshold that he or she is guaranteed a fabulous job on graduation. There was a time when multinational companies went to campuses to recruit students in their final year. Now the rush to get IIT graduates is so frenzied that companies are approaching and signing up students who are not even in their final year of study. Given the craze for IIT graduates in Silicon valley, they are potential millionaires.

It makes sense to subsidise incipient millionaires. The IITs provide a world class education very cheaply by international standards. If you have such a good product, hordes of people will be very willing to pay for it. Such a product should be priced high enough to yield a surplus after meeting all costs, a surplus which should be used to steadily expand the number of seats, and ultimately the number of campuses. That is the way to maximise public welfare.

Paying fees of Rs 2 lakh per annum is impossible for poor families. Some favour scholarships. In fact the obvious solution is to have a student loan programme. IIT students must be the most creditworthy people in the world. Surely Deepak Parekh of HDFC Bank will offer them educational loans at the prime rate. If necessary infotech NRIs themselves can set up an educational fund to give loans. There is not the slightest reason to give loans at a subsidised rates: remember that the full cost of IIT education is peanuts compared with the salaries these graduates will soon command. Far from emphasising subsidies, IITs should aim to generate a surplus of at least 10 per cent per year, to be ploughed into expansion.

This will not be in keeping with their traditions, or those of Indian academia in general. So I suggest that Kamal Rekhi, Sudhakar Shenoy and other infotech NRIs should abandon their plans to give hundreds of million dollars to support existing IITs, and should instead plan to start one new IIT every year in India.

These new IITs should hire the best staff and pay them highly competitive salaries, not the low salaries that characterised IITs in the past. The fee structure should cover all costs and generate a surplus for expansion. Arrangements should be made in advance with banking and other institutions for student loans. Maybe the new IITs themselves can provide student loans on demand.

This will open the way for doubling the output of IIT graduates within five years, and quadrupling them in ten. It will also be a way of raising salaries of IIT teachers and making it attractive for the best to stay in India. Faculty exchanges with western universities can help further.

We desperately need more and more centres of excellence today. Hats off to Jawaharlal Nehru for having the vision to launch IITs in the 1950s. What we now need a new vision that aims at rapidly expanding the number of IITs. The government looks too short of money or ideas to fill that role today. It should be filled by NRIs wanting to make India a land of opportunity.

What do you think?