Foreign universities Bill ...

... has got the Cabinet's approval [see also WSJ and NYTimes]. It did cross this obstacle once before (back in 2007), but failed to make it to the Parliament. Let's see if this Bill survives the likely mauling by MPs in the Lok Sabha.

To me, foreign universities are like any other private institution. Also, they represent diversity in educational methods, examinations, admissions, and administration; thus, they are a potential source of innovation. So, I'm all for foreign universities as long as they don't ask for concessions [see #1 below].

A few additional thoughts [some of them are repeated from here and here; I have collected a bunch of links here]:

1. Will the Harvards and the Oxfords flock to India? Unlikely. Because, foreign campuses are expensive operations -- and they become impossible without 'incentives' or 'earnest money.' For example:

   When John Sexton, the president of New York University, first met Omar Saif Ghobash, an investor trying to entice him to open a branch campus in the United Arab Emirates, Mr. Sexton was not sure what to make of the proposal — so he asked for a $50 million gift.

   It’s like earnest money: if you’re a $50 million donor, I’ll take you seriously,” Mr. Sexton said. “It’s a way to test their bona fides.” In the end, the money materialized from the government of Abu Dhabi, one of the seven emirates.

2. But the present Bill demands 'earnest money' from the foreign universities! They are required to deposit Rs. 50 crores ($11 million) with the government before they are allowed to start their Indian operations.

3. The likely effect of this provision will be to encourage them to enter India through a partnership with an Indian organization. Thus, it is a major deterrent to the serious players who want to be in India on their own.

4. A ToI story claims that Georgia Tech faculty at its Indian campus will earn the same salary as those at its Atlanta campus.

   I don't believe a word of it -- unless Georgia Tech plans to use its Indian campus for educating rich kids capable of spending five million to ten million rupees over four years. But here's the thing: if kids can spend this much, they might as well go to the Atlanta campus!

5. There's another possibility: to keep the costs down, the Indian campus will be primarily a teaching shop. But what is so special about the Indian Georgia Tech if there's little research?

   Research is expensive, and will require extensive support from government. I can't see the government bankrolling a foreign university's research facility in the absence of anything in return.

So, who'll come? In the short term, a few teaching shops and for-profit entities. Also, a few B-schools. Especially if they follow the ISB model of offering a short-duration MBA to those willing to pay a couple of million rupees.

Kapil Sibal seems keen to sell the idea of millions of students getting high quality education at Indian campuses of foreign universities. I think he knows better; he's saying this stuff only -- at least, primarily -- to sell the Bill, which will help burnish his credentials as a 'reformer'.

Bottomline: While the impact of foreign universities will be symbolic, I also expect it to be (disproportionately) significant: (a) their 'customers' will come from India's elites, and (b) they'll focus on high-visibility and high-prestige areas of business and technical education.