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Sunday, December 10, 2017

Loans from HEFA

There are media reports that the first set of loans have been approved by Higher Education Funding Agency (HEFA) for five old IITs and one NIT (Surathkal). It is an interesting model of funding, which no one seems to understand. On paper, it is very clear. You take a loan of some amount now and you pay back 10% of it every year from your internal accruals with zero interest (interest is paid by the government). So the total amount of loan you can take is 10 times your internal accruals.

From the language of it, it would appear that the expectation is that the loan will be invested in ways that will increase the internal accruals and thus the loan will be paid off from that additional income. Is that really the expectation.  finds out from a few IITs and writes her findings in this report in Nobody is really expecting to have larger internal accruals because of this investment. They may have a larger internal accruals because they may further increase fees, hostel charges and other user charges, which they could have done even without HEFA.

Does it make sense for an IIT to take loan. Well, if this was for a crucial infrastructure, which was already budgeted in the next 10 years, then essentially what you are doing is that spending that budget now, and not later, and what is great is that you don't pay any interest. So really fantastic for IITs. Whatever money was budgeted over the next several years will now not be spent, and in fact they will save money since a budget of 100 crores next year is based on a 5% inflation. You will only spend 95 crores this year. Hence you will only pay 95 crores next year and still save 5 crores in the next year's budget. So, fantastic scheme for IITs.

But does anyone plan for next 10 year. Do we really know what our priorities will be a few years from now. Is there a guarantee that Government will keep funding us at a certain rate. Would an interest free loan not encourage us to invest in lower priority infrastructure and then if our grants are not increased at the rate expected now, we will be in deep trouble.

But is there a real risk for IITs. Actually, no. In future, when IITs have to pay back, if Government gives us additional grants, well that is obviously great. If Government does not give us additional grant, we just increase user charges, and let Government deals with the hue and cry.

The only real risk is if the impact of all this is different on different IITs. If Government does not give us adequate budgets in future. If some IIT took smaller loan and don't have to raise user charges as drastically. Or if and some IIT is able to raise funds from additional sources like philanthropic funds, and do not have to raise user charges. In such a situation, an IIT which has no option but to raise user charges will be vilified. So the game is not exactly clear. And, therefore, for an IIT to take loans for high priority items is ok, but if they start taking loans of low priority items, they could be in some trouble.

So the basic question facing the IITs is: What if they take small loans, and government bails out IITs with big loans in future. You will appear stupid at that time. On the other hand, what if they take a lot of loan and government does not bail them out in future.

Saturday, December 9, 2017

What is in the name?

Recently, a newspaper item caught my attention. While the headline talked about colleges having to mention all fees on website, something that will enhance transparency, reading the whole article made me aware of other guidelines issued by AICTE. They apparently have decided that no institute in the country can have a name whose initials will be IIT or NIT or IIM or IISc, etc. To learn about the exact guideline (I couldn't believe that AICTE could be doing this, but if they are doing this, what is the complete list of initials that are banned), I visited the AICTE website, and I couldn't find anything there, which is, of course, not very surprising.

What is the implication of this. Well, if I want to start a new engineering college, and want to name it as "Narnaul Institute of Technology" I can't do it, since the initials will become NIT, which is banned as per this order. I expect the first reaction of the readers to be, what is wrong in this. The private sector guys are all scums and trying to fool people into believing that they are not what they are. So such restrictions are ok.

But think about it. Is it being done because private sector guys are all scums, or is it being done because there is a genuine fear that some student/parent will get confused between Narnaul Institute of Technology and National Institute of Technology Kurukshetra. If it is the former, then the only possible public policy response is to close ALL private sector educational institutions. There is no point in allowing all scums to run educational institutions. So I will assume that AICTE is concerned about the confusion that such names can cause.

Is that a reasonable concern (and hence a reasonable restriction), or has AICTE gone overboard. If mere similarity of initials can cause confusion in the minds of students and parents, then should we have 23 IITs. Should we have 31 NITs (of course, some of them have slightly different initials). Is it reasonable to assume that a typical student and parent can distinguish between National Institute of Technology Raipur and National Institute of Technology Rourkela but they cannot distinguish between them and Narnaul Institute of Technology. In my opinion, if someone can distinguish between 31 institutes with not just same initials, but same names, they can certainly distinguish between institutes with completely different names.

And what if I change the name of the institute to "Narnaul Institute of Technology Narnaul" and now claim that the initials are not NIT but NITN, and then go ahead and advertise myself as NIT Narnaul. Would I be on the right side of AICTE.

Were there many complaints by students and parents that they got confused. Will AICTE tell us which institutes they confused with. Or is it a pre-emptive strike. Could it be that there is a specific institute which is being targeted by its competitors and AICTE has naively supported one side.

And if the goal was indeed to help students and parents, why help their confusion only with respect to some government institutes. If a student is getting confused between Birla Institute of Science and Technology and Barabanki Institute of Science and Technology, shouldn't AICTE help those students as well. BITS is a great brand today, even better than NIT brand (in my opinion), and hence if you want students to not get confused with some college initials being NIT, you must also want students to not get confused with some other college initials being BITS. And where does it stop. How do we decide which initials are being confused with, and which initials are not being confused with.

I am glad that they have not included IIIT in the initials (at least not mentioned in the newspaper reports). Otherwise, IIIT Hyderabad, which arguably has the best brand with that initial today, would have to change its name again.

Wouldn't it be better to first look at the instances of confusion and see if those confusions are because of misleading advertisement. If yes, book those institutes under various acts of law, instead of putting some arbitrary restrictions on names.

ADDED on 9th Dec:
I am told that they have included IIIT also in the list of reserved initials. This is very interesting. IIIT Hyderabad came up with the unique initials. Government of India liked those initials and set up its own institutes with the same initials. Now it is telling IIIT Hyderabad that you can't have same initials as my institutes. Is this fair.

Wednesday, November 8, 2017

No Technical Degree Programs through Distance Education

Last week, Supreme Court has given a judgment which says that no educational institution can offer degrees in technical subjects without specific approvals from regulatory bodies, namely, UGC and AICTE. It has also suspended engineering degrees obtained through distance education of batches between 2001 and 2005 from 4 institutions. These students now have to give tests in both theory and practicals within the next 8 months and pass those tests, without which their degrees will be cancelled. And those admitted after 2005 will have no recourse to such a test. Their degrees from the same four institutions will be cancelled.

One can find media reports here: LivelawScroll.inTimes of India, and LiveMint.

I read the entire 118 page judgment, and frankly, found it rather confusing, and at times, a bit overreaching.

Is it really fair to ask students who received their degrees 10 years ago to give a test again in all the subjects. A lot of what you study at college is not meant to be remembered after a while. It is supposed to broaden your horizons, and you can apply certain learning from such courses in your life. A test at the end of the semester is supposed to ensure that you have gained a fair amount of understanding at that time, in the hope that some of it would be internalized in your education. But remembering all that to pass the test after 10 years is certainly asking for too much. Now, if AICTE prepares a test at the level of what a decent university will do, and ask students to pass 45-50 such tests in less than 45-50 days (of course, after a preparatory period of 6 months), only rare students would pass such tests. If AICTE were to prepare a test at the level of what a poor quality university would do (and there are many of them in our country), or better still, just ask them to pass a single exam like GATE, AICTE would be admitting its failure in regulating engineering education in the country, and telling the whole world that that is the level at which Indian education system operates.

But not permitting even this relief to post-2005 students is a bit strange. Is it the argument that admissions till 2005 were in confused zone. But after 2005, there was complete regulatory clarity that they were not supposed to admit students, and they still did. First of all, SC is admitting in its judgment that these institutions had indeed some approvals from some regulatory bodies (which turned out to be illegal), and they had stay orders from High Court. So the institutions were in confused zone even post 2005. So either you say that the distance programs were illegal throughout or you say that there were some confusions. This division into two time zones is not sufficiently clear. And in any case, should we consider confusion of institutions or confusion of students. Are we saying that students till 2005 were genuinely confused about the legality of the programs, but post 2005, they should have known better. I am not convinced.

The judgment is also reiterating a typical Indian mindset - that degrees are more important than knowledge. After 10 years, their continuation in jobs should be based on their performance and not based on their degrees (unless it was clear that they cheated to get their degrees, in which case, they are being punished for violating the law and not because of poor quality of education). As far as whether the employer must give them benefit of the degree, the court could have ruled that employers should do the testing on their own to figure out whether they deserve those benefits, instead of AICTE doing such a testing.

To draw a fine line between deemed to-be universities who continue to offer programs in disciplines which they had at the time of such a notification, and deemed to-be universities who offer programs in new disciplines (in which apparently they have no expertise) was completely unnecessary, and frankly reflect the lack of understanding of how educational institutions are supposed to work.

The reason why universities are allowed freedom to decide what new disciplines they can get into is that universities are very conscious of their reputation and prestige. If they are excellent in one discipline and they are trying to expand into another discipline, they will make sure that they are excellent in the other discipline too. SC repeatedly pointed out that at least three institutions were granted deemed to be university status for their quality in certain subjects other than engineering, and hence somehow starting engineering discipline was bad in law. Come on. Is it anyone's case that these three institutions are excellent in those disciplines to begin with. If you accept their quality in arts and whatever else, you better accept their quality in engineering also. They too have maintained their reputation by starting new programs, whatever that reputation was.

SC finds it interesting and indeed disturbing that a college affiliated to a university which as per its act have certain restrictions in operations once becomes a university itself will not have any restrictions which the initial affiliating university had. Frankly, I don't find this disturbing at all. If the promoters of the original university (which is typically a state government) want to free the university of those restrictions, they can do so any time through a change in the Act. That they do not wish to remove those restrictions can not be the reason for maintaining those restrictions to this newly minted deemed to be university. And this logic has been used to put deemed to be universities back into the regulatory control of AICTE, which is so sad, given the past record of AICTE in maintaining the standards of engineering education in the country. The judgment has essentially said that best quality institutions like BITS Pilani will now have to seek approvals of a poor quality institution called AICTE for many things.

I am not at all suggesting that the distance programs offered by these four institutions were great or even acceptable. I am only suggesting that LOTS of academic programs offered by LOTS of universities, including government universities, are very poor quality. Hence reference to quality of education in a judgment is unfortunate. Either the judgment is based purely on the applicability of law, or all poor quality programs must be closed. And if the judgment is based purely on the applicability of law, there should not be any reference to extraneous issues like quality. References to quality give an indication that judgment was influenced by concern for quality and a strict interpretation of law may or may not have happened.

The Supreme Court has thrown a bombshell which was not even a question in the case. It has decided that no deemed-to-be-university can use the term "university" in its name. What happens to so many institutions which use the term "university" in their name. Are they going to change their branding overnight (or within a month). Will it not affect their programs, admission process, attracting faculty and everything else. Just like some relief has been provided to students admitted in 4-5 years, shouldn't some relief be provided to those institutions who are using the term "university."

SC mentions that engineering education requires practical training and use of labs and that is why distance education cannot be allowed for engineering degrees. Almost the entire engineering education in the country is without practical training and use of labs. That is why the graduates are unemployable. As I have often said in many blogs, I always ask each MTech admission aspirant whether they have written even a 100 line program, and the answer in most cases is that they haven't. And remember, I only interview students from good institutions. I do hope SC will find a way to close most engineering education in India by quoting this judgment. (Don't tell me that labs are part of curriculum, they were part of curriculum of these 4 institutions also. The question is whether these universities even had the infrastructure in their study centers to conduct those labs. And the question is whether colleges who do have these labs, ever conduct lab work.)

Now, the next level questions will be, what is a distance education program. From the definition of distance education, MOOCs are certainly distance education. If a university offers a program in which students can get upto 50% credit from MOOCs, is that distance education. As per Washington Accord that India is signatory to, we are expected to recognize degrees granted by accredited institutions of other signatories of the accord. And some of these institutions have started offering a program based on MOOCs. Can a university in India transfer those credits, if not allow MOOCs directly under its banner.

On a lighter note, someone famously said that distance education starts from the 3rd row of a lecture hall. Should we ban large classes.