Does the overseas venture of IIMs hinder their domestic expansion?

No. On the contrary…

The reasons the Indian governement gave for refusing to allow the Indian Institute of Management-Bangalore (IIM-B) to open its first overseas campus in Singapore are that overseas expansion is not permitted under the IIM charter, and that they must focus on addressing the ‘huge domestic supply/demand gap’ first. The first is bureaucratic. The second is idiotic.

On the other hand there are several reasons why allowing the IIMs to spread their wings internationally is in India’s interests. Some have to do with improving the quality and quantity of management education in India. Others of these have to do with projecting India’s ‘soft-power’ abroad.

It is a well-known fact that overseas campuses allow universities an excellent means to generate revenues, in hard currency, by tapping the global market for management education. The need to keep tuition affordable and equitable leaves universities with little room to increase fees in their domestic markets, resulting in their dependence upon government grants and alumni donations. But once they step out of their home ground, they are acknowledged to be purveyors of a ‘luxury’ good, and are able to charge a premium over their costs. And apart from rentals of building and facilities, the cost of overseas expansion is marginal. Like prestigious universities elsewhere, the IIMs have an excellent opportunity to make some good money.

And contrary to the simplistic assumptions of the Indian government, the overseas expansion does not necessarily come at the cost of the IIMs domestic expansion. For a start, the extra revenues raised abroad can be used to attract talented faculty to improve the quality of teaching. And extra revenues can be used to fund domestic expansion — a cross-subsidy of sorts, where in effect, foreign students pay a part of the domestic student’s fees. In its absence, funds for domestic expansion will have to come from the government or students.

What about faculty then? Will there be enough good professors to handle growth. It is a fallacy to believe that there are only a fixed number of good business school professors out there. Provided they offer the right incentives, the IIMs will be able to attract sufficient number of staff to teach at their new domestic and foreign campuses. So the ability of the IIMs to recruit more staff is not constrained by the number of campuses it sets up, but the kind of incentives it offers to prospective faculty. Allocation of staff, like allocation of funds is a management challenge. Surely, more than the presumptious folks at the human resources development ministry, the IIMs can be trusted to figure that one out.

The IIMs are well-placed to be international ambassadors of the Indian industry. And beyond education and business, the expansion of Indian social, cultural and educational institutions serve to enhance its soft-power abroad. From a foreign policy perspective, IIM-B’s Singapore campus is a no-brainer. In fact, the Indian government should consciously encourage IIMs, IITs and private schools to set up more such branches, and take in more foreign students in their domestic campuses. In yet another example of disconnected decision-making in Dr Manmohan Singh’s cabinet, the human resources development ministry seems to have taken this decision without taking into consideration wider economic and foreign policy interests. Despite its explanation, it is hard to beat the conclusion that the reason the Indian government has blocked IIM-B’s foreign venture to prevent it from achieving greater financial freedom. The prime minister would do well to reverse a myopic, retrogressive and ultimately self-defeating decision made by his feckless HRD minister.

Update: The Indian Express sheds more light on the bungling within the HRD ministry, and criticises its decision in a related editorial.

51 thoughts on “Does the overseas venture of IIMs hinder their domestic expansion?”

  1. Money is not everything. Already the Indian IT Educational Cos like NIIT,Aptech, etc are helping the Chinese catch up and eventually overtake us in the IT field. Now you want IIMs and IITs to help others to steal our future?

  2. RS,

    You’re kidding, right?

    Do you really think keeping IIMs, IITs and even the Aptechs and the NIITs locked up at home will prevent others from competing with India?

    Btw, the IITs and IIMs are late entrants into the offshore campus game. So nobody will miss them if they don’t turn up.

  3. IITs and IIMs should stay within the country.

    The argument : Setting up universities abroad would earn them money to setup institutes in India.

    answer : If you setup universities abroad and earn money, that money would be taxed as income when it gets repatriated. Different countries have different laws and maybe singapore has less tax than say china or say australia. The income (in cash or dividend) is generally taxed and to prevent this, companies would stay invested and increase their investment.

    the argument : Foregin institutes are doing it, why not us ?

    Thats because, foregin institutes have created enough capacity and are seeking students for their universities. Thats why, you have them fighting a piece of the indian student population. IIM should focus and setup an IIM in every single state.

    More importantly, we should understand that IIM is not a corporate body like NIIT or aptech. They were started, funded and their brand has been built using tax payers money. Its time, they got accountable.

    vasu

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  5. Of Course, Locking up IIMs and Aptechs of India wont stop the Chinese and others from competing with us. But at least in the case of IITs and IIMs their priority shud be India and Indians and just as Vasu states they shud open up IIMs in every state of India.
    BTW, How wud it be if they are corporatised and listed on the stock markets? Hmmm….money making machine?

  6. Steal our future? Well, how would it be if the US stops issuing visas and fdi ceases in the country? U need to understand that any such venture is mutually beneficial and it doesnt necessarily suggest that one party is profiting at the cost of the other.

  7. Nitin,

    I read your post. Disagree with your point of view

    I am not bothered about the motivation about Arjun Singh. I am looking at what is good for the country. Having said that not everything that is done by him has to be necessarily wrong

    Today IIMB has no issue generating resources in India either by fees or by consulting assignments either here or abroad. The issue is whether they can scale up with the same quality levels. In any case I do not think the Singapore centre will start generating tons of money

    In theory they can start n number of campuses at the same time. But in practice going from managing one campus to managing three campuses will be a very different cup of tea. Just recruiting good faculty does not make a great institution.

    My point is that in practice for IIMB and IIMA it will be indeed be an either or situation. They will find it very dificult to manage two new campuses Singapore and say Mysore at the same time

    When the rest of the world is trying to promote their countries as education hubs why are we not trying the same stuff here. Why not create International campuses here to attract students from abroad ?

    Soft power is fine but the more important thing is to ensure that we continue to have sustained economic growth. A economically strong country can have all the soft power it wants. For an economically weak country soft power is just empty words. And mark my words for India one of the biggest issue as a bottleneck for growth is manpower

    I am not arguing for government control of IIMs. I am just looking at the merits of IIMB’s decision to set up a Singapore centre

    Rgds

    Sameer

  8. Its simply wrong nothing else. Forget weather they can make more money outside or inside. Let see what they have done for India. Afterall isnt this institute built on the funding of Indian taxpayer.

    I think we have to nip this movement in the bud. If the IIM professors so desperately wants to create a world class name let them get out of IIMs and form their own institute and do what they please with their money.

    Its high time, we stop using national resources for foreigners.

    IIM property, money and the brand itself belongs to the people of this country and not to a few.

    vasu

  9. Don’t have to worry about IIMB. Already private management schools like XLRI have set up shop in Dubai and Singapore. BITS, Pilani too have set up an overseas center in Dubai way before the IITs. Their gain is government-school’s loss. There is no love lost here.

  10. RS, Vasu & Sameer,

    First of all, let me point out where I agree with the three of you: given their charter and use of government funds, the primary role of the IIMs must be to provide high quality management education to as many Indian students as possible.

    My argument is that overseas expansion does not hinder in their ability to achieve this. On the contrary it can help them in achieving this. Opening foreign centres and expanding to more centres within India are not only mutually exclusive, but can be mutually reinforcing.

    Vasu: You make three arguments, the third of which you admit renders the first irrelevant. You argue that since their overseas profits will be taxed abroad they won’t have funds to repatriate and invest at home; second, the reason the foreign universities are doing this is because they have excess capacity; and third, it is simply wrong for IIMs to venture abroad because they are ‘national’ assets, funded by the taxpayer. Let me address each one of these points:

    a) The fact that overseas profits are taxed is not an argument against investing abroad. You’ve not cited any proof (corporate tax rates in those countries, for example) that the countries where IIMs intend to open actually have such high tax rates that makes investment unattractive. If you dig it up, you’ll find that even if taxed at the maximum rate, the IIMs will get to keep more than 80% of the profits they make in Singapore.

    b) I’m not sure if you, or someone you know, has gone through the process of securing a place in a good international business school. It’s not as if they are dying to get rid of excess capacity. And if they did, lowering fees and entrance criteria would be an easier and cheaper way to raise funds, rather than go through the trouble of setting up a campus half-way around the world. No, they are doing it because they want a share of the lucrative international business of business education.

    c) Educational institutes, even taxpayer funded ones, are national resources yes, but educating foreigners (or even NRIs abroad, whom the IIMB foreign campus targeted anyway) does not diminish their ability to serve the Indian taxpayer. In fact, as I’ve argued it enhances their ability to do so. Nobody is arguing that the brand and the institution belongs to ‘the few’ (whoever they are). Education is not like a piece of cake. You don’t lose yours when you give it to someone else, even to a foreigner.

  11. Sameer,

    You make three points: first, the practicalities of scaling up make it an either/or situation (if quality is to be maintained); second, why not create international campuses in India itself, and make India an education hub; and third, soft-power can be achieved by being economically strong, and India confronts manpower bottlenecks in future. Let me address these:

    a) I agree managing growth will be a challenge. But it is not sufficiently big a challenge in order to rule out, by governmental fiat, an attempt to expand abroad. Even if, in the very worst case, we assume one IIM is fully drained by the task of operating one overseas branch, isn’t it reasonable to assume that the remaining IIMs will be able to still meet the goals of expanding their domestic reach? Furthermore, don’t you think the management of IIMB is better placed to decide what they can or cannot manage than the bureaucrats in New Delhi. If you trust them to teach management, I guess it follows that you must trust them to practice it.

    b) Encouraging foreign students and institutions to come to India is something that can (and should) be pursued concurrently. Again its not an either/or option. (But becoming an education hub requires much more than good universities…)

    c) While a strong economy contributes to developing soft-power, it does not automatically follow that only strong economies can (will) have soft-power. And if there is a risk of a manpower bottleneck emerging, it can be easier realised by liberalising higher-education than by expecting the government to create sufficient number of MBAs to support India’s future needs. That’s why even during the blogosphere’s recent exposure of IIPM’s lies, I argued that the government’s role must be to establish, maintain and raise standards, while allowing private institutions to address the demand.

  12. >>The fact that overseas profits are taxed is not an argument >>against investing abroad. You’ve not cited any proof (corporate >>tax rates in those countries, for example) that the countries >>where IIMs intend to open actually have such high tax rates that >>makes investment unattractive

    From what I understand about investments and money flow by repatriation, investing in facilities and faculty outside of India is a full fledged affair. Even that would mean a legitmate risk in setting up campuses attracting faculty and building facilities before any of the returns come into place. All this in the hope that some of profits can be ploughed back into India. I dont see the rationale in going through all this rigmarole and risking my money on overseas business. I am sure it would take atlest 3-4 years to break eaven and generate profits, by which the next cycle of investment and upgradation have to start. This venture is not the most viable option for IIM’s to raise money to meet demand in india.It might add to their global sized prestiege and ego, but I think thats not the premise on which this institute was initially built for.

    I think, in the next point you are supplementing what I said. Business education in India is very very lucrative (believe me, I went through the grind mill and have attended IIM interviews). The competition is insane and if they want to raise money by fees, they can do it easily. Moreover, IIM brand is a regional brand having much much more brand equity here in India than in overseas where other brands like Harvard, MIT, stanford, Kellog’s are well entrenched. You dont need too much money to setup an institute in India. I am sure IIM already has its own funds to do that. The government can fund it, if it wants. This will address the problem of demand head on than go on a rigmarole of repatriating foreign earnings.

    IIM’s are managed like SBU. Bangalore, Ahmedabad, Cal all managing their own finances. Looking at this precedence, IIM (singapore) would also be managed autonomously. I fail to see why money would be unconditionally transferred back to India for increasing seats.

    Its the same mechanism of restrict demand and create an fictitioys notion of standard that Institute of chartered accounants of India has been following. There is a nexus of a few professionals denying opportunities to other, in the guise of quality.

    All this is ok with a pvt institute, but not acceptable with public funded institutes. Its time they got accountable.

    vasu

  13. Thats a nice idea. Why not disband IITs and IIMs.

    My solution comes like this.

    1) Disband IITs and IIMs.
    2) Return back the land to those from whom it was acquired before.
    3) Enact a law in the parliament preventing any individual/company to use the brand IIT and IIM in its acronymn and expanded form for the next 50 years.

    I dont care then, who goes to singapore and who goes to timbuktoo.

    vasu

  14. Err,

    When I said disinvestment it did not mean disband.

    What I meant was since Indian government has spent considerable capital in order to make IIM / IIT a Top level brand name, why not leverage it by privatizing the institution. More so because it can not be said that Tax payers are getting sufficient returns on investment.
    Even at present the institutes are higly autonomous so change of ownership should not make lot’s of difference.

    Regards

  15. Indian beau have always been frightened with competition, so it is not a wonder that they dont want competion with other institutes.

    At MIT usa and other ivy league one sees very well groomed and developed Chinese students who are very industrious, unlike people who come from india and while they gain admissions and slog, because of their inferiority laced with arragonce they are poorly, dressed and not marketable for commerce.

    Going and opening campuses around the world would be a good idea.

    I saw directors and heads of ICMR, and other Tamil places and they make you vomit.

  16. India needs to remove the Indian image of bongs and tamil temple boys and the so called wooden donkey .

    I can tell you that as the world is opening up you meet many people from the world who may not speak English but are very intelligent, creative and well adjusted and attractive to a work force that constantly needs reengineering.

    Indians can barely speak english, comprehend and I must say have very poor technical writing skills , but they are arrogant temple boys especially from black india which is piggy

  17. Nitin: Your blog is getting really famous now that you have our venerable Han brothers coming in as trolls. Too bad they did’nt teach that MIT is not an Ivy League school. You might wanna check the IP address to see which CCP Propaganda Dept. sends in them.

  18. I don’t understand why IIMA should bare the sole burden of dealing with management education supply/demand. Months ago, it got slapped around when it wanted to raise fees to become less of burden on tax payers and because the value of the education it provides is so much high – based on the starting salaries of graduates.

    Now the same tax payer excuse is used to slap them again when it wants to expand.

    The fall back is the same reason that kept the country in economic darkness for three decades – you have to serve your people first, whatever that means.

    If HRD is so concerned the IIMA will neglect India-based institution while it focuses on overseas expansion, a better alternative would to put a condition that for every seat that IIMA creates overseas it needs to create one in India and put some quality metrics on watch list, for, say, five years, so that expansion does not hurt the quality of the program.

    Well, that’s just too much to ask from Indian babus and netas – let’s just take the easy obstructionist path and offer lame reasons.

  19. To the folks who say IITs and IIMs should not go abroad, I ask, when ONGC can go abroad, why not IIM? ONGC is an Indian company, a PSU. And there’s a lot more money invested by it abroad than the IIMs put together can do so now.
    The argument about IITs and IIMs not going abroad because they are funded by the Indian tax-payer is ridiculous. Which taxpayer would not want the IITs and IIMs to make some money so he has to spend less per each IIT/IIM-grad? Just think about the money that can be diverted to things where we cant skimp on – mid-day meals in schools for example.

    The biggest advantage of going abroad (with rotational faculty/students of course!) would be the interaction. Knowledge and wisdom aren’t spread or created in isolation – they need, indeed thrive, under interaction among peers. Such interaction would allow for a much better curricula and resulting education in the IIMs – If need be attach quality parameters on it, but for Gods sake, let go of the stupid Isolationist strategy in a globalised world!!

  20. The comparison being made between IITs/IIMs and ONGC is a fallacious one. ONGC is a PSU with a charter that allows, indeed requires it go outside the country. II*s on the other hand are supposed to be “institutes of national importance” set up specifically to narrow the demand supply gap for good quality higher education within India. How does venturing outside the country help further this charter ?

    IIMs in particular, charge an arm and a leg for an MBA degree and presumably they are not subsidized by GoI money. So what stops them from expanding the supply of MBA degrees in India ? Is it simply a lack of money ? People would line up for an IIM education even if they were to add hundreds of seats overnight and charge a 50% premium over the current fees.

    So what stops IIMs from doing so ? At least partly, its a lack of well qualified faculty. How many management PhDs does India produce every year ? Partly its also an elitist mindset, thats afraid that the “brand” would loose its value if a few more people were to be admitted to the program.

  21. Why can’t a separate ‘private’ institution be made, which will concentrate on foreign operations, and IIMs signing business contracts with this entity for exchanging resources.

    Although, I would strongly favour deciding colloborations on individual cases, rather than a totally business-like way of doing things. Example, Singapore keeps huge Chinese domination by artificial means there. May be, have IIM-O (O for Overseas) goes there on the condition that it will take-in certain percentages of students from each community……(I know it might be falling over from the other discussion about reservations)

  22. Sachin,

    Example, Singapore keeps huge Chinese domination by artificial means there. May be, have IIM-O (O for Overseas) goes there on the condition that it will take-in certain percentages of students from each community……(I know it might be falling over from the other discussion about reservations)

    I can’t even believe you’re saying that. What’s it now, the valiant Indian government imposing its version of social justice everywhere?

    You’re being ridiculous, my friend.

  23. gaurav – Why not disband what is wrong with it ?

    As rightly pointed out by sudeep. IIM and IITs were created to cater to local demand. I say, they have failed in their charter. Instead of spending on going abroad, they should spend that money and setup campuses in India. I think its high time, we leveraged the brand power created by India and setup atleast 20 other IIMS in each state capital.

    ONGC is in oil exploration. It goes where the oil is. IIT and IIM are in education for Indians. It should go where India is. This is really a no-brainer.

    There are many institutes in India (in the pvt. sector), which have stuck to this charter out of a sense of mission than IITs and IIMs. If there can be one REC in each state, why not have an IIT and IIM in each state. Afterall, this is going to vastly expand the availability of quality govt. education to a wider populace than the elite who end up working in the corporates.

    Going a little deeper, why is the govt. in the business of providing PG mgmt education atall ? Isnt it important to provide primary education first before going to PG mgmt education ? Why not disband IIMs totally and prevent others from utilising the brand name ?

    Whats wrong with that. Maybe gaurav should think about this.

    vasu

  24. >>don’t understand why IIMA should bare the sole burden of dealing >>with management education supply/demand. Months ago, it got >>slapped around when it wanted to raise fees to become less of >>burden on tax payers and because the value of the education it >>provides is so much high – based on the starting salaries of >>graduates.

    because that was the purpsoe of creation of IIMs in the first place. The move by IIMs to move out of govt. control is suspect because, they have been sold out to corporates. Look who all are in the board of IIMs. NRN and Ambaini. These are the same people who have taken India for a ride. Can you trust these guys to fullfill the charter ? I doubt so. Both raising fees from students and moving out of India is a move to distance itself from the govt. (people of India) without being accountable. Till the 90s it was the govt (people of India) who had supported IIMs. Now since they have the money (they can raise the money), they should fullfill the charter. We cant let that slip away. The chicken should lay the golden egg for the farmer and not for itself. If it cant do so lets kill it and make some biriyani

    >>The fall back is the same reason that kept the country in economic >>darkness for three decades – you have to serve your people first, >>whatever that means.

    It means accountability. While people are so eager to ask netas and babus to be accountable, thy forget that IIMs and IITs are also accountable. A clear case of double standards.

    >>If HRD is so concerned the IIMA will neglect India-based >>institution while it focuses on overseas expansion, a better >>alternative would to put a condition that for every seat that IIMA >>creates overseas it needs to create one in India and put some >>quality metrics on watch list, for, say, five years, so that >>expansion does not hurt the quality of the program.

    I dont mind IIMs expanding outside provided it created 10 times more seats in India for every seat it creates in timbuktoo. But then, I dont trust these white collar thieves. Let them first create the 10 seats in India first and then ask for expansion overseas.

    >>Well, that’s just too much to ask from Indian babus and netas – >>let’s just take the easy obstructionist path and offer lame
    >>reasons.

    If netas and babus fail, they are thrown out of ofice by the people of India. We call that accountability. I remember the finance minister of TN was stoned when he entered his constituency in the next election. He was apparently making a first appearance there after 5 years. He failed and the people taught him a lesson. Ofcourse that year JJ lost her deposit from bargur. I think the Indian people have learnt to handle their political masters through democracy. But there is an even more sinister evil lurking. The sauve sophesticated industrialist-upperclass-educated nexus. How do you handle them ?

    vasu

  25. Vasu

    ONGC is in oil exploration. It goes where the oil is. IIT and IIM are in education for Indians. It should go where India is. This is really a no-brainer.

    Interesting that you put it this way. I was having an offline discussion with a (foreign) public policy professor on this, and a main reason he cited is that IIMs must go abroad because Indian industry is going abroad.

  26. Vasu,

    Going a little deeper, why is the govt. in the business of providing PG mgmt education atall ? Isnt it important to provide primary education first before going to PG mgmt education ? Why not disband IIMs totally and prevent others from utilising the brand name ?

    I’m glad you think that the govt has little business of providing post-graduate management education in the first place. If it has to get out of it, and focus on say primary education, which is more important, why take the destructive root and disband the IIMs when you can privatise them. Call them something else by all means.

    But Vasu, you seem to have changed your mind on state-funded higher education in the last few days. In the debate over reservations, you said:

    >>Higher-education is not a right.

    Higher education is a right. I differ. You cannot and should not deny higher education because you donot have adequate seat. If this philosophy is firmly entrenched, you can find a way to meet the demand for education. The government has to work towards that. [link]

    Make up your mind.

  27. Nithin,

    I havent changed my mind. Just that the argument for higher education in professional courses like engg. medical, law, arts, science is much different from post graduate programs in management.

    Anyway, how many managers are serving public sector (may the soul of Manjunath rest in peace).

    IF govt is to disband IIMs which is a good option since the IIMs are not going to cater to local demand, why make a little money by underselling those assets. Lets not make money and lets not let selfish individuals like ambanis and murthys to make money. Lets disband it completely and prevent anyone from using the name.

    or the other option. Let govt take over completely all IITs and IIMS and do away with all the industrialists on board of directors. Lets then make it a five year mission to expand them to every state in the country.

    I think thats not destructive. Thats just protective of a resource developed by the people of India and preventing these resources to fall into the hands of unscrupulous individuals.

    vasu

  28. Do we have a john kerry here ?

    But on second thoughts IIM and IIT should not be disinvested.

    That way our bleeding hearts will not get money to spend on such hare -brained idead as REGS (rural employment guarantee scheme), which will mean either they will have to raise taxes or borrow money.
    This will also mean that economy will tank and we will again have to beg before world bank, this will mean that we will be able to see another round of liberalization

    Am I being too optimistic ?

  29. Vasu,

    Just that the argument for higher education in professional courses like engg. medical, law, arts, science is much different from post graduate programs in management.

    Why? What’s the justification? Without substantiation, your arguments are mere assertions. You are entitled to your beliefs, but if you seek to convince others, you need to substantiate them.

    Anyway, how many managers are serving public sector (may the soul of Manjunath rest in peace).

    Why should they? And how many of those other professionals you mention are serving the public sector? If you want to make a case that says government must not fund post-graduate management education because their graduates do not work in the public sector, you must substantiate your claims with data.

  30. >>Why? What’s the justification? Without substantiation, your >>arguments are mere assertions. You are entitled to your beliefs, >>but if you seek to convince others, you need to substantiate them.

    I thought it was self evident and people can make distinguish between the two. anyway here I go.

    MBA courses pertain to learning of tools, techniques and theory of management of resources. MBA is certainly not a pre-requisite for becoming a manager. Many non-MBAs have been great managers. Whereas the same cant be said about engineering/medical/law/CA etc. Esp for law/CA/medical etc. you need to be schooled on specific skills before you can enter that vocation. As you go higher and higer into management part of education, your need to learn specific body of knowledge decreases and therefore MBA is not of vital national importance, unlike in medicene and law where the reverse is true. Higher education in management is generic in nature and that in other streams tend to become specific. Any MBA grad would know this. Somehow I feel, I am re-inventing the wheel in discussing this ? is not all this understood already ? enlighten me.

    Having said that what do we do with the IIMs already setup and running ? Disinvest ? or Disband ? or be supported (in return for accountablity) by the govt ?

    which is a good option. Gaurav has been gunning for disinvestment.

    It is not the govt.’s business to support industry during times of distress and create businesses when pvt. market players dont take risk, only to disinvest and sell it off later to the same private players.

    If you have invested, you own it to the end and dictate the course of the institution. It doesent matter for the government weather they make money or not. Govt. is above economic policies of this country. Afterall, government is money. We can do with a little deficit financing in the center to fun worthwhile national investments. Many leading economists have supported deficit financing in building key infrastructure resources in the country.
    Dis-investment is therefore totally out of question.

    Disbanding of IIMs – If the argument that “govt has no business in higher education” does prevail, lets disband IIMs and prevent others from capitalising on the brand that GOI has created.

    The middle path however is accept govt. responsibility to cater to demand and go full hog in increasing investment and spreading the base. Create one IIM in every state in the country. That way atleast we will not be dabbling in half measures (like it has been till now) and full fledged live uptop a charter. Its a case of blurred vision. Some believe IIM should become a center of excellence by going abroad and some believe that it should become a center of excellence while meeting domestic demand. Support IIMs in return for full accountability.

    A summary of my statement is simple. If IIMs have to exist, they have to by catering to local demand. Otherwise lets disband and cease their existance.

    vasu

  31. Last couple of years I was travelling in China, Vietnam and some places in the Pacific. You can’t imagine the amount of good PR (about India) NIIT and Aptech have brought by setting up operations in these countries. It is not a waste of public money. I would think than any such campus would be sustaining itself in a couple of years. Also, like the INSEAD in Singapore, I am sure some local companies and organisations will chip in to help build the campus etc. The good thing about Singapore is that students from South-East Asia and China can also join such an institute.

    The point that foreigners who learn in these campuses will compete with Indians is rubbish. Creativity and innovation is not a zero sum game. Also, Chinese universities are actively recruiting foreign teachers and China will be setting up Confucius Institutes in mazor cities around the world.

    India has a history of sending scholars to the East. Lets not stop it.

  32. Vasu

    If you have invested, you own it to the end and dictate the course of the institution. It doesent matter for the government weather they make money or not. Govt. is above economic policies of this country. Afterall, government is money.

    Is the government also above the laws of physics? Just asking.

  33. >>Is the government also above the laws of physics? Just asking.

    Govt. is the people and people’s law always prevails. Thats democracy and the trust on this kind of system people place is the sole reason you dont have those who are kept out of economics running guns. Wherever this trust has failed, people have looked onto gun as a means of getting justice.

    Sarcasm apart, Govt. controls economy and decides the nature of the economy. Govt is the bank in which people have placed their trust in getting justice and a support system. This is so even in western countries where social security is gaurenteed. I think this is more than necessary in today’s India.

    We need to strengthen this institution first before talking of liberalisation.

    vasu

  34. >>It is not a waste of public money. I would think than any such >>campus would be sustaining itself in a couple of years. Also, like >>the INSEAD in Singapore, I am sure some local companies and >>organisations will chip in to help build the campus etc.

    Any public funded educational body with a charter of catering to educational demand in India when it goes out of India deviates from the charter. It is a waste of money. I think, it is important to spend money where the real stake holders get benifit than collect brownie points from foreign countries. Remember India exists for Indians in India and not for other countries. Thats why I said before, IIM was not created to garner prestiege but to provide management education in India.

    >>The good thing about Singapore is that students from South-East >>Asia and China can also join such an institute.

    Totally Irrelevant.

    >>The point that foreigners who learn in these campuses will compete >>with Indians is rubbish. Creativity and innovation is not a zero >>sum game.

    Foreign students may not compete with Indian students. But definitely this would eat into the rights of Indian students. Why are those mighty brains in IIMs so scared to move out of IIM and setup their own Mgmt institutes ? Wont their big papa (ambani) and mama (murthy) wont fund it ? Why not emulate Rajath gupta and set up an institute like ISB ? If they do that, there is no issue atall right ?

    >>Also, Chinese universities are actively recruiting foreign >>teachers and China will be setting up Confucius Institutes in >>mazor cities around the world.

    “China is doing this and china is doing that” is no sufficient reason for Indians to do. China is an autocratic country. If I were a chinese, just based on my blog responses I would be jailed. That is total antithesis of democracy. Looks like selfish interest tower above principles of democracy on which this country was based on.

    Sorry, cant give that up.

    vasu

  35. Vasu,

    Did I miss the point here:

    ONGC is in oil exploration. It goes where the oil is. IIT and IIM are in education for Indians. It should go where India is. This is really a no-brainer.

    Or did you mean to IIMs should go where Indians are? That would mean a lot of places outside of India, no?

    And if you’re saying that, I’d say, you are giving more reasons for IIMs going to Singapore.

    btw, Isnt the KV existing outside of India?

    Its very curious that you say, wrt to the Govt money:

    If you have invested, you own it to the end and dictate the course of the institution.

    So none of the IIM alumni or the faculty have any say in that? The Government was, at best, an enabler(and many times not so!). No babu or minister sat at his desk and made the IIMs or IITs noteworthy. Sure, credit to the people who thought of and supported the idea, but without the students and faculty what is an IIM or IIT, really? Just another school isnt it?

    By extension, since I own it, after all its my tax money, cant I take a decision too? 😉

  36. Vasu,

    It means accountability. While people are so eager to ask netas and babus to be accountable, thy forget that IIMs and IITs are also accountable. A clear case of double standards.

    Its not. The charter is specific on the IIMs being autonomous institutes and the funding is clearly spelt out, and vetted by the HR Ministry – which as you can see for yourself disapproved a certain spending.

    Also I find the contention about there being a need for a hundred IIMs as ridiculous. What is the use of an “elite” institute if its not going to be so anymore? Where is the aspirational value?
    To give an example – Ferrari is perhaps the only car maker that sells less vehicles than it can, even though it loses on profit, precisely because of the “value” attached in its elitist moorings.

    The IIMs, IITs and IISc are all elite institutes. Their value is in their exclusivity.

    While its no one’s case that we should have more world-class B-schools, we should look towards upgrading the schools that arent so. Asking IIMs to spread themselves thin is not the solution.

  37. “What’s it now, the valiant Indian government imposing its version of social justice everywhere?”

    No, just that the valient Indian government safeguarding its interests by trying to ensure populations who see it as a threat do not get too influencial by using India’s own tools .

    “You’re being ridiculous, my friend.”

    I agree, the pie is on my face. There can be better ways.

  38. Vasu, The jailing of bloggers happens but very rarely. I would even argue that China has more personal freedom than India – but that is a different discussion. I did not bring up China to impress that we should do it because the Chinese are doing it. I have seen the positive changes in Chinese campuses because of foreign teachers and students. The same with the teachers who go out of China to work for the institutes they are setting up and other joint programs. Unfortunately Indian Univs. are not very active in this area.

    Setting up a foreign campus does not take anything away from Indian students. Such a campus would give IIM students and staff more exposure. And having a presence in East Asia is very relevant – how about the “look east policy”. There are thousands of American, Korean, Vietnamese and Burmese students studying in China. Once these guys graduate and work for companies back in their country, they form a valuable external network for China and Chinese companies. It helps China’s long term economic goal. It is not just about earning brownie points. And when you are sending a message out that you are becoming active, you send out your best – so I would rather have IIMs or IIT than some lesser known univ.

    I probably don’t have much exposure to the internal politics of these IIMs or IITs. What I am saying is from the point of view of a person who spends a lot of time in the campuses in East Asia. Just the other day, I was helping a Chinese friend with his MBA applications to schools in the US. He was doing some research and he was surprised to find out (from a Chinese online forum) that it was harder to get into a particular IIM in India compared to Stanford. It would be a waste if we do not capitalise on this.

  39. >>Also I find the contention about there being a need >>for a hundred IIMs as ridiculous. What is the use >>of an “elite” institute if its not going to be so >>anymore? Where is the aspirational value?
    >>To give an example – Ferrari is perhaps the only >>car maker that sells less vehicles than it can, >>even though it loses on profit, precisely because >>of the “value” attached in its elitist moorings.

    I think it is not fair to the impoverished common man who is struggling for survival and social justice. Try telling him that the money he is paying as taxes to the govt. is being invested in creating a “ferari”. I am utterly shocked that one can even suggest some things. To me, this form of elitism runs contrary to the grain of equality. Its a fundemental difference in philosophies. If IIM were a pvt. institute, nurtured, fed and grown provately, I would have agreed with you. Sadly it is not. The IIMs are firstly accountable to the govt. If autonomy has been granted, lets revoke it immediately. A common man like me would feel more secure with a babu/neta as an IIM chariman than some capitalist manager. I say lets do away with IIMs. Disband it and give back the land to those who need it more.

    >>The IIMs, IITs and IISc are all elite institutes. >>Their value is in their exclusivity.

    As I think where else in history this statement would have been equally applicable (without ref to IIM and IIT ofcourse), I remember these instances.

    1) Gentlemen clubs in England considered exclusive.
    2) Casinos in Cuba which were considered exclusive.
    3) Segregated clubs and restraunts in the southUSA which were also bred on exclusivity.

    Thanks my friend, IIMs in your view has joined that club. My fight is so much more to break that notion of exclusivity and elitism. Thats not how a democracy should function. We dont want exclusive previlages to a few at the cost of others. That money can be better used for the poor.

    >>Vasu, The jailing of bloggers happens but very >>rarely. I would even argue that China has more >>personal freedom than India – but that is a >>different discussion. I did not bring up China to >>impress that we should do it because the Chinese >>are doing it. I have seen the positive changes in >>Chinese campuses because of foreign teachers and >>students. The same with the teachers who go out of >>China to work for the institutes they are setting >>up and other joint programs. Unfortunately Indian >>Univs. are not very active in this area.

    The point here is in china, there are no disagreements tolerated. For every swanky shangai you see, there are millions of peasants who are paying the price in blood. The reason why there are slums in India and not so in china is simple. They dont allow slum developement. They pretend asif it doesent exist, in pockets of influence. India is a compassionate country where a lot of people’s freedoms are protected.

    >>Setting up foreign campus doesent take away >>anything from Indians….

    It takes away opportunities for Indians. Indian institutes are for Indians and not for anything else.
    Building a stronger India, means building from within. Let the IIMs contribute to nation building first, before increasing their brand value. I dont care, if IIM’s brand reduces or increases. We all know brand is notional. What I am intereted is how many Indians in India get to study in IIMs. That and that alone should be the measure of IIMs. certainly not pat on the back from foreigners.

    Prasanna :

    Please tell me with all your might intelligence where in the world are the most Indians available ?? Somehow I cant understand the kind of kiddish arguments you make. Are you for real ?

  40. China is known for its suppression of rights amongst its people and the situation is getting from bad to worse.

    Before we shoot our mouth about china, we should look a little deep and see weather the things that happen in china routinely are the things, that we want.

    Please read this article The dark side of the chinese moon by Yang liang. Yang has summarised Chen Guidi and Wu chuntao’s much acclaimed work titled “The survey of chinese peasants”. This work has sold millions of copies all over the world and has been banned by the chinese government.

    Before we become china hailers, it makes sense to look at all sides and soul search weather this is the kind of government India should have.

    My answer is a resounding “NO”, “NEVER”.

    happy reading

    vasu

  41. The controversies engaging HRD ministry and IIM seems to be seasonal. It was not very long back that hue and cry involving the IIM fees hike swept across the country and attracted myraid of comments. If it involves taking sides then all those who still have not sold their entire conscience in today’s open and liberalised era will not discard the stand of HRD as totally prepsoterous.
    Is opening a new campus in foreign soils the only way left for the IIMB to make money, as that is the only thing one can conclude about it.
    As far as gaining through exchange of faculty, students, curriculum is concerend, it doesn’t require one to open new overseas branches. Many universities, IITs, IIMs, IISc etc already have interacted worldwide but never felt a dying need for an extra campus.
    Indeed money ciculation have increased worldwide and economies are playing more role than anything else in fostering the development of a country but we are still a socialist democracy and the inherent obligations and responsibilites of elite educational institutes of the country towards ever increasing youth of this country are felt more than ever.
    IIMA’s collaboration with a leading french B-School who is opening its overseas campus in singapore from may2006 shows that IIM can reach out through indirect ways as well. One wonders why IIMB is making a useless propaganda about this issue rather than exlporing other more feasible and gainful options.

  42. What next? Send ISRO aborad to impart training on building and launching satellites? Hey they could in the process learn to be better at their job and even gain brand recognition. After all ISRO like IIMs are funded by the tax payer.

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