The Vice-Chancellors from across the country have urged the Government to set up a Higher Education Loan Guarantee Corporation as bank loans for education attracted a high rate of interest and was thus out of  reach for poor students.

The VCs of universities and deemed-universities, who have congregated here for a national conference to draw up an action plan for higher education for the 11th Plan, made this recommendation.

Their recommendation was a logical corollary  to the Human Resource Development Ministry’s proposal of  hiking fees for higher education, which it observed was ‘ridiculously low’. The proposal also suggested  that fees could be gradually increased  to recover a maximum of 20 per cent of the operating expenses. It was also felt that such a step would  be met with resistance from stakeholders and thus the decision could be taken at the level of  government and communicated to the universities and colleges so as to safeguard them from local politicking.

Apart from providing scholarships and fellowships at large-scale to increase the Gross Enrolment Rate to 15 per cent in the 11th Plan, the academicians also asked the government to introduce students loan programme offering enhanced moratorium in loan repayment in order to increase affordability. Describing the Government’s submission that revenue realisation from students is very low as  ‘half-truth’  they said if we take into account the total revenue collected from fees in the regular courses and self-financing division together, the contribution of  fees revenue could be as high as 30-40 per cent of  the total revenue of  the universities and colleges.
Though opinion was divided over the level of  fees chargeable from students, it was strongly felt that fees could not and must not be considered as a major source of  revenue for universities and colleges. 

There were also proposals that the industry should be encouraged to adopt colleges and universities in their neighbourhood or  those that are engaged in research and development in the areas of  their interests. The industry should then sponsor research and make investments in infrastructure and human resources for improvement of quality and excellence in these institutions.

HRD Minister Arjun Singh had already proposed to the Planning Commission that the corporate majors should be encouraged to adopt colleges and vocational institutions particularly in the educationally backward districts through fiscal incentives such as 100 per cent deduction of  their contribution from their assessable income under Section 80 G of the Income Tax Act.

“I am hopeful that the Finance Minister would review the present taxation laws and see as to what more needs to be done in this direction, so that contribution to at least the public educational institutions from the private sector is fully exempted,” he said addressing a full meeting of the Planning Commission.