Revamping India's Higher Education System

Kaushiki - April 29, 2010

The shortage of skilled man-power is a cause for concern in most sectors in India. Experts acknowledge that the present higher education system in India is not equipped to address this problem without some changes in the basic structure. Official records show that the gross enrollment ratio in higher education is only 11 per cent while the National Knowledge Commission says only seven per cent of the population between the age group of 18-24 enters higher education. Even those who have access are not ensured of quality. Despite having over 300 universities, not a single Indian university is listed in the top 100 universities of the world. Present Regulatory framework The present system of higher education is governed by the University Grants Commission (UGC), which is the apex body responsible for coordination, determination and maintenance of standards, and release of grants. Various professional councils are responsible for recognition of courses, promotion of professional institutions and providing grants to undergraduate programmes. Some of the prominent councils include All India Council for Technical Education (AICTE), Medical Council of India (MCI) and the Bar Council of India (BCI). The Central Advisory Board of Education coordinates between the centre and the states. Universities in India can be established by an Act of Parliament or state legislatures such as Delhi University, Calcutta University and Himachal Pradesh University. Both government-aided and unaided colleges are affiliated with a university. The central government can also declare an institution to be a deemed university based on recommendation of the University Grants Commission. There are about 130 deemed universities and includes universities such as Indian Institute of Foreign Trade and Birla Institute of Technology. Such universities are allowed to set their own syllabus, admission criteria and fees. Some prominent institutions are also classified as institutions of national importance. Reforms in Higher Education There have been calls to revamp the regulatory structure, make efforts to attract talented faculty, and increase spending on education from about 4% of the Gross Domestic Product (GDP) to about 6%. Presently, the allocation for higher education is at a measly 0.7% of GDP. From time to time government appointed various expert bodies to suggest reforms in the education sector. The two most recent recommendations were made by the National Knowledge Commission (NKC) formed in 2005 under the chairmanship of Mr Sam Pitroda and the Committee to Advise on Renovation and Rejuvenation of Higher Education, formed in 2008 under the chairmanship of Shri Yashpal.

Key Recommendations of NKC	Key Recommendations of Yashpal Committee
Presently, India has about 350 universities. Around 1,500 universities should be opened nationwide so that India is able to attain a gross enrolment ratio of at least 15% by 2015. Existing universities should be reformed through revision of curricula at least once in three years, supplementing annual examination with internal assessment, transition to a course credit system, attract talented faculty by improving working conditions and incentives. A Central Board of Undergraduate Education should be established, along with State Boards of Undergraduate Education, which would set curricula and conduct examinations for undergraduate colleges that choose to be affiliated with them. An Independent Regulatory Authority for Higher Education (IRAHE) should be formed. IRAHE should be independent of all stakeholders and be established by an Act of Parliament. The UGC would focus on disbursement of grants and maintaining public institutions of higher learning. The regulatory function of the AICTE, MCI, and BCI would be performed by IRAHE. The IRAHE shall have the power to set and monitor standards, accord degree-granting power to institutions of higher education, license accreditation agencies, and settle disputes. Same norms shall apply to all institutions irrespective of whether they are public or private, domestic or international. Quality of education can be enhanced by stringent information disclosure norms, evaluation of courses by teachers and students, rethinking the issue of salary differentials within and between universities to retain talented faculty, formulating policies for entry of foreign institutions in India and the promotion of Indian institutions abroad.	The academic functions of all the professional bodies (such as UGC, AICTE, MCI, and BCI) should be subsumed under an apex body for higher education called the National Commission for Higher Education and Research (NCHER), formed through Constitutional amendment. The professional bodies should be divested of their academic functions. They should only be looking after the fitness of the people who wish to practice in their respective fields by conducting regular qualifying examination. Establish a National Education Tribunal with powers to adjudicate on disputes among stake-holders within institutions and between institutions so as to reduce litigation in courts involving universities and higher education institutions. Curricular reform should be the top-most priority of the NCHER. It should be based on the principles of mobility within a full range of curricular areas. Vocational education sector should be brought within the purview of universities. NCHER should promote research in the university system through the creation of a National Research Foundation. Practice of according status of deemed university be stopped till the NCHER takes a considered view on it. NCHER should identify the best 1500 colleges across India and upgrade them as universities. A national testing scheme for admission to the universities on the pattern of the GRE to be evolved which would be open to all the aspirants of University education, to be held more than once a year. Quantum of central financial support to state-funded universities should be enhanced substantially on an incentive pattern.
Sources: The Report to the Nation, 2006-09, NKC; Yashpal Committee Report, 2009; PRS

The Draft NCHER Bill, 2010 In response to the reports, the government drafted a Bill on higher education and put it in the public domain. The draft National Commission for Higher Education and Research Bill, 2010 seeks to establish the National Commission for Higher Education and Research whose members shall be appointed by the President on the recommendation of the selection committee (include Prime Minister, Leader of the Opposition in Lok Sabha, Speaker). The Commission shall take measures to promote autonomy of higher education and for facilitating access, inclusion and opportunities to all. It may specify norms for grant of authorisation to a university, develop a national curriculum framework, specify requirement of academic quality for awarding a degree, specify minimum eligibility conditions for appointment of Vice Chancellors, maintain a national registry, and encourage universities to become self regulatory. Vice Chancellors shall be appointed on the recommendation of a collegium of eminent personalities. The national registry shall be maintained with the names of persons eligible for appointment as Vice Chancellor or head of institution of national importance. Any person can appeal a decision of the Commission to the National Educational Tribunal. (For opinions by some experts on the Bill, click here and here.) Other Bills that are in the pipeline include The Foreign Educational Institutions (Regulation of Entry and Operation) Bill, 2010; the Central Educational Institutions (Reservation in Admission) (Amendment) Bill, 2010; and the Innovation Universities Bill, 2010.

Legislation

Challenges emanating from the AERA (Amendment) Bill, 2021

Aditya Kumar - August 6, 2021

The Airports Economic Regulatory Authority of India (Amendment) Bill, 2021 was passed by Parliament on August 4, 2021. It amends the Airports Economic Regulatory Authority of India Act, 2008. This Bill was introduced in Lok Sabha during the budget session this year in March 2021. Subsequently, it was referred to the Standing Committee on Transport, Tourism, and Culture, which submitted its report on July 22, 2021.

Typically, cities have one civilian airport which provides all aeronautical services in that area. These services include air traffic management, landing and parking of aircraft, and ground handling services. This makes airports natural monopolies in the area. To ensure that private airport operators do not misuse their monopoly, the need for an independent tariff regulator in the airport sector was felt. Hence, the Airport Economic Regulatory Authority (AERA) was established as an independent body under the 2008 Act to regulate tariffs and other charges (development fee and passenger service fee) for aeronautical services at major airports.

For the remaining airports, these tariffs are determined by the Airports Authority of India (AAI), which is a body under the Ministry of Civil Aviation. In addition, AAI leases out airports under the public-private partnership (PPP) model for operation, management, and development. Before AERA was set up, AAI determined and fixed the aeronautical charges for all airports. It also prescribed performance standards for all airports and monitored them. Various committees had noted that AAI performed the role of airport operator as well as the regulator, which resulted in a conflict of interest.

The 2008 Act designates an airport as a major airport if it has an annual passenger traffic of at least 35 lakh. The central government may also designate any airport as a major airport through a notification. The Bill adds that the central government may group airports and notify the group as a major airport. Thus, when a small airport will be clubbed in a group and the group is notified as a major airport, its tariff will be determined by AERA instead of AAI. Note that AERA will not determine the tariff if such tariff or tariff structures or the amount of development fees has been incorporated in the bidding document, which is the basis for the award of operatorship of that airport.

The amendments under the Bill raise some concerns regarding the grouping of airports and the capacity of the regulator.

Grouping of airports: The Statement of Objects and Reasons of the Bill states that government will club together profit-making and loss-making airports and offer them as a package in PPP mode to the prospective bidders. This may be a policy decision to revive loss-making airports. With the passage of the Bill, AERA will treat a group of airports as one entity. One of the ways in which tariffs may be structured for the grouped entity would be through cross-subsidies. This would involve compensating loss-making airports with the revenue generated from the profit-making airports. If such a model is used, it may increase the cost of services to the end-consumers of profit-making airports or could reduce the profitability of such airports. The experiences from other sectors such as electricity show that cross-subsidisation may lead to pricing problems in long term.
Capacity of the regulator: AERA was created to provide a level playing field in the aviation sector and resolve the conflict of interest that arises with AAI both operating and regulating tariffs at airports. During the examination of the AERA Bill, 2007 by the Standing Committee, the Ministry of Civil Aviation informed the Committee that AERA should regulate tariff and monitor performance standards only at major airports. Depending upon future developments in the sector, and as the regulator built its capacity, other functions could be subsequently assigned to the regulator.

As of 2020, there are 125 operational airports in India (includes international airports, customs airports, and civil enclaves). The number of airports under the purview of AERA increased from 11 in 2007 to 24 in 2019. For the remaining airports, tariffs are still determined by AAI. In the last five years (2014 to 2019), air passenger traffic increased from 11.3 crore to 34.9 crore (which is an annual growth rate of 10%). Till 2030-31, air traffic in the country is expected to continue growing at an average annual rate of 10-11%.

Before 2019, an airport with annual passenger traffic of at least 15 lakh was considered a major airport. In 2019, the AERA Act was amended to increase this threshold to 35 lakh. The Statement of Objects and Reasons of the 2019 Bill stated that the exponential growth of the aviation sector has put tremendous pressure on AERA, while its resources are limited. Therefore, if too many airports come under the purview of AERA, it will not be able to perform its functions efficiently. Consequently, in 2019, the number of airports under the purview of AERA was reduced. Now, with the passage of the 2021 Bill, AERA will have to again regulate tariffs at more airports as and when notified by the central government. Thus, the capacity of AERA may be needed to be enhanced for extending its scope to other airports.

Table 1: List of major airports in India (as of June 2019)

Ahmedabad	Delhi	Mumbai
Amritsar	Goa	Patna
Bengaluru	Guwahati	Pune
Bhubaneswar	Hyderabad	Raipur
Calicut	Jaipur	Thiruvananthapuram
Chandigarh	Kolkata	Tiruchirappalli
Chennai	Lucknow	Varanasi
Cochin	Mangalore	Kannur

Source: AERA website as accessed on August 2, 2021; PRS.

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Revamping India's Higher Education System

Challenges emanating from the AERA (Amendment) Bill, 2021

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