IIT fee hike is a horrible, disastrous idea

After months of prolonged speculation on whether the government will or will not raise the fees of IITs in accordance with the recommendation of the IIT council, the cat is finally out of the bag. The Union human resources development (HRD) ministry has decided to more than double the tuition fees of IITs from the current Rs 90,000 annually to Rs 2 lakh.

Given the IIT standing committee, expert committee and finally, the high-powered IIT panel all recommending steep fee hikes, the decision to raise the fees was more about "when" than "if". But still, many who refused to read the writing on the wall are a disappointed lot today. Their disappointment is not without basis.

The decision has far reaching implications which few of us have factored in. It will negatively affect our society in many fundamental ways as we discuss below:

1. Weaken the future of IITs, kill new IITs and be a death knell for public and affordable education

The past few years have seen the dominance of IITs being seriously challenged by private colleges such as the Birla Institute of Technology and Science (BITS)-Pilani. Still the inherent brand advantage, good alumini network and low fees held the IITs in good stead.

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But the rise in the fees of IITs will reduce one of their principal advantages over their private rivals like BITS, VIT and Manipal University. These private institutes will now have similar fees as IITs, in addition to better linkage with the private sector, more flexible decision-making, more updated course structure and less rigid rules regarding matters like attendance.

Also with decks being cleared for the entry of foreign universities, and many large private players (Ambanis, Mittal, Anil Agrawal to name a few) showing interest to enter and expand in the field of higher education, the road ahead for our national jewels like IITs is set to get more rough.

The effect of this reduced advantage vis-a-vis private competitors will be mostly acutely felt by the newer IITs. It will kill new IITs as they have yet not made their mark and with such steep rise in fees they will have difficulties in attracting talent.

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So they will be impaired in their infancy itself and will not be able to build a strong network that will make them institutes that the nation can be proud of. By stunting the new IITs the government's already humoungous investment in them will go down the drain, thereby also counteracting the fiscal argument in favour of the fee hike.

Furthermore, over the longer term, reducing public funding of public institutes of excellence will seriously weaken both old and new institutes vis-a-vis their private counterparts. This is nothing but a privatisation of our higher education through deliberate undermining of our public education system.

The upstarts, who ask what the harm is in case of privatisation through the backdoor, only need to look at how a dominantly privatised higher education sector in the US has led to student debt becoming one of the top challenges before the country, to realise the perils of surrendering public good that education is to the private sector. Increased inequity, lower innovation and less diversity are just a few of the other ills that afflict the private education system and have made it unpopular wherever it prevails.

Also this fee hike must not be thought as something which will affect only the IITs. Today it's the IITs. Tomorrow it will be other public (and private) institutes as IITs often set the benchmark for fees. So an average Indian, already under severe stress because of reduced income growth as a result of rural distress and lower-than-promised growth, will bear the double whammy of increased expenditure and less income.

2. Abuse of monopoly

Over decades, the Indian government has monopolised the higher education space through policies that left little room for the private sector to open and operate. The result is that today, IITs enjoy a dominant monopolistic position in elite technical higher education. They face little competition even though the situation is fast changing.

Now the government can't suddenly wake up one day and announce to charge market rates after systematically preventing the evolution of the market in the field. After creating a monopoly in the name of public welfare, it is nothing but extortion from the students, to double the tuition fees to Rs 2 lakh per annum. As a number of students still prefer IITs for good technical education in India, this amounts to the government fleecing them because the government knows that the ordinary Indian is helpless.

Also, the whole logic of recovering the cost is suspect. BITS, which didn't get the free land that the IITs are endowed with, manages to give equally good education with matching fees. So why should IITs, whose professors are paid less, whose lands come cheap, charge higher tuition fee than BITS? It just doesn't add up that despite lower input costs the IITs should have higher fees.

3. Thwart free think and create graduates enslaved to their loans

Many of the alumini of IITs have gone on to contribute to diverse fields such as arts, politics, literature, research and what not. They were able to do so because an education in IIT made them aware of the possiblities of the world and provided an opportunity to interact with minds from diverse backgrounds, without burdening them with exorbitant fees, the repayment of which could take away their most creative, carefree and energetic period of life - their youth years.

But now with such a large fee, IIT students will become enslaved to loans. They will no longer be as free to pursue their studies and passions as their minds will be filled with the worries of repaying fat loans. This will create a society poorer in terms of ingenuity, innovation and free thinking as students enslaved to their loans will have no option but to run towards white-collared labour.

What sort of a society will we be where our best minds are systematically disincentivised to be the artist and the thinker, to pursue vocations which may not have high monetary value but are as necessary for a heathy, vibrant, critical and diverse society?

4. Body blow to Start-up India

The past few years have seen an unprecedented zeal in the start-up environment. More and more of our students have turned to starting new enterprises. IIT alumini have been at the forefront of this critical change. Be it Flipkart or Snapdeal, many of the leading start-ups were founded by students who benefited from the affordable education IITs provided (over 60 per cent of series A start-ups are by IIT-IIM graduates.).

But raising IIT fees will disincentivise the start-up culture. Because students burdened with loans to repay will have a hard time taking the path of entrepreneurship, which involves high risk and low profitability in the initial phase. Thus, this measure will be a body blow to the start-up culture as students will now be forced to work to pay large loans rather than start their own companies. This will reduce job generation, wealth creation and tax collection. The government will have to forgo a lot (in terms of tax collection, and prosperity), much more than it gains through fleecing the students.

5. Widen campus divide

The move will create a more divided campus and, in effect, a more divided society. As the difference between the fees of those enjoying exemptions and those paying full fees rise, the resentment among those paying full fees will also rise, so there will be less harmony in the campuses and hence, in the society. A diverse nation like ours can ill-afford such suspicion and distrust among the youth who are its future.

Therefore, the decision to hike fees in IITs must be carefully analysed, and the profound impact it can have over the long-term should be discussed. In an environment with increased clamour to have taxpayers' money withdrawn from higher education, the decision may not raise many an eyebrow.

But becaue of reasons discussed above, such an understanding which sees education merely as a private good which should be paid fully by the receiver lacks appreciation of the wider role education has in shaping a prosperous, conscientious and diverse society.

The subsidy we pay to have cheaper education in IITs is an investment we make in our collective future. To that extent, cutting down this subsidy makes our collective future that much poorer and hence is a classic case of being penny wise and pound foolish.