The basic situation in Indian higher education right now is as follows:

The national government is putting most of its new money into the creation of new institutions (IITs, mainly), which are elite in local – but not international – terms.  That placates the politically powerful upper-middle class, but does very little for access. The rest of the public sector is required to chug along with limited funds.

Capacity-absorption (that is, dealing with the growth in demand) is essentially being left to the private sector.  But the developing private sector looks a lot more like the one in Latin America than the ones we see in China or Eastern Europe.  That is to say, instead of having some reasonably-sized institutions that can use economies of scale to provide mass teaching at a reasonable quality, what India is getting are literally tens of thousands of tiny, sub-standard institutions.

Not that it’s impossible for some of these small institutions to break out from the pack.  A few have done so, such as my particular favourite, Lovely Professional University in Punjab (it is named after the founder’s family business, an odd mix of sweet shops and car dealerships).  It’s gone from zero to 25,000 students in about a decade, but that’s very rare, and rests on having been “deemed a university” before the University Grants Commission (UGC) instituted a moratorium on new universities of this type.  No one is getting that chance any more, and new Lovely Professionals are likely to be few and far between.

Broadly, there are four things that need to happen here.

First, private money needs to get funneled into larger institutions, including public ones.  With the national government seemingly unwilling to do anything but throw money at the top end, the neglected middle needs money somehow – and the best somehow is tuition.  Right now, millions pay it in significant amounts to go to sub-standard colleges; it is simply incomprehensible why one wouldn’t want that money go into institutions of higher quality.  Currently the government keeps tuition low (roughly $250/year) in public institutions (while allowing it to float in private ones) on largely spurious grounds of accessibility.  Let tuition rise, create better student aid systems, whatever – but letting private money into public institutions is a necessity.

Second, whether by carrot or stick, institutions need to be encouraged to merge.  A system of 1,500 colleges with 10,000 students apiece will be enormously better for the country than a system of 30,000 institutions with 500 students apiece.  How it happens is secondary – it simply has to happen.

Third, too much regulatory power rests in Delhi; de-centralization is needed.  Even though 90% of universities are funded privately or by state governments, the UGC still effectively controls the entire system, including the curriculum.   A system serving a country of over a billion people is simply too large to run from the centre.  The centre should continue to regulate the 40 or so universities it funds directly; for everyone else, power needs to be transferred to the states.  There will undoubtedly be the odd catastrophe during the transition, but in the long run it will be worth it.

Finally, there needs to be a lot more diversity of provision, and a shift from input-based to outcome-based regulation.   Decentralization is useless if the states just replicate what the UGC is currently doing.   The UGC is innovation-averse and prone to politically-motivated interference in universities affairs (see, for instance, its sabotaging of Delhi U’s attempts to modernize its curriculum through the creation of four-year degrees).  More openness – including an openness to foreign institutions setting up shop in India – would not go amiss.

Of course, the chances of any of this happening are pretty remote… for which Canadian institutions should be thankful: it’s precisely India’s inability to improve its own system that is creating such marvellous market opportunities for our own institutions.  Lucky us.