What are Private universities, Background of Private universities, Need, Issues, Reforms

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Private universities are those universities which are self-financed and managed by private groups. University Grants Commission (UGC) defines private university as “a university established under any Central or State Act by a sponsoring body viza society, trust or a company registered under Society Registration Act, 1860 or Companies Act, 1956 respectively”. Private universities in India, however, cannot run without the approval of UGC. A UGC is a government regulatory and funding body for various academics institutions in India. Private universities in India are regulated under UGC Regulation 2003. UGC recognised private university has to run according to its rules and regulations

Private university education in India has been booming since last two decades. The education market in India is worth billions and is increasing exponentially. On the basis of size, India has the third largest higher educational system in the world, next to China and to United States. New Economic Policy of 1991 have benefitted education sector most. Private players have established themselves for providing higher education in almost every Indian state. With the regular increase in the number of students, the seats are getting reduced in colleges and universities. As of 2020, there are 361 private universities in India catering to aspirations of lakhs of student population,

Background of Private Universities

In 1857, first three universities were established at Bombay (now Mumbai), Calcutta (now Kolkata) and Madras (now Chennai). At the time of Independence in 1947, there were 20 universities and several hundred affiliated colleges. With the liberalisation of economy policy, there has been surge in the provision of private higher education in India. Till 1980, higher education sector was controlled by the government and there after, there has been trend towards privatisation of higher education. Setting up of private universities under the State Private University Act by individual and private trusts is a new trend in privatisation of higher education in the country during 21st century.

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Need of Private Industries

In this section, we will discuss some of the factors which led to the growth of private universities.

• Limited Seats in Government Colleges and Universities :

With already less number of seats for graduation and post-graduation in government colleges and universities and cut throat competition to avail it, private universities have come as blessing in disguise for aspirations of millions of students. The private sector has been playing an influential and Vital role in the field of education in India. In fact, 50% of educational institutions in India are privately owned,


• Increase in Gross Enrolment Ratio (GER):

Gross Enrolment Ratio can only be increased by the involvement of private institutions in higher education. In New Education Policy 2020, there is emphasis on 50 per cent Gross Enrolment Ratio (GER) in higher education by 2035. It can only be achieved by involvement of private universities.

•Opening of ‘Deemed to be University Route’ :

With the opening of ‘deemed to be university route’, the degree can be awarded by private as well as by government institutions. In the early years, this privilege was extended only to government/government aided institutions. Manipal University, a pioneer in private higher education became the first totally self-financed institutions to be declared as a deemed to be university in 1976.

•Quality of Education :

Private university competes in par with best government institutions in providing high quality education. Increasing collaboration with foreign institutions generally attracts students for opting private university instead of public university.

•Job-Oriented Course :

A major attraction of the private universities is the job-oriented courses they offer. Training and placement is an important activity in most of the private universities. Some of the universities have collaborations with industries for students internship and placement.

Issues Concerning Private Universities

Private universities have done more harm than providing benefits. Private university runs on profit motives by charging hefty fees from students for courses. Private universities invite students for higher education, but no guarantee of job is given after completion of the degree or diploma.

Private higher education institutions are often accused of charging capitation fees (any amount in excess of fees charged for the course of study) from students, in turn making them unaffordable. Fee structures of private institutions may be one reason for inaccessibility of higher education. Exorbitant capitation fees in private institutions ranged from 1-10 lakh for engineering courses, 20-40 lakh for advanced courses in medicine, 5-12 lakh for dental courses and 30,000-50,000 for courses in arts and science.

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Education has become business and private university has become company for doing business. In name of education a nexus of politician, goons and educational professional are establishing colleges/universities and laundering the illicit money in establishing institutions to escape the wrath of tax officials. With increasing large force of educated unemployed is a serious issue of concern. With falling standards in education, it is pity that India don’t have a single private university in top 100 best universities in world despite 50% of higher education need is met by private university.

Reforms in Private Universities

Over the years, the Supreme Court of India has interpreted the nature of educational institutions to be charitable and not for profit. Therefore, supernormal or illegal profits cannot be made by providing education. If a revenue surplus is generated, it is to be used by the educational institution for the purpose of its expansion and education development.

Private universities should ensure that they do not become mere machines for producing graduates and post-graduates like their government counterparts. The efforts and time of the students and the money of their parents should not go in vain. The emphasis should be on the high quality education and on the need to adapt the changes quickly and effectively. The rules and regulations should be such that the foreign students are also attracted to study in India.

They should, therefore, have to be given the flexibility to raise resources. The legal and administrative frameworks allowing private sector operations should be simplified. There should be deterrents for those who provide poor quality education and use the system to make profit. Both National Knowledge Commission (NKC) and Yashpal Committee recommended that, it is essential to stimulate private investment in higher education to extend educational opportunities. The Yashpal Committee also pointed out that while private investment is high in the emerging areas of engineering, medicine and management recommended that the private sector should not confine itself to the commercially viable sectors. Government on its part should take the role of establishing more university and

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colleges in higher education along with private sector in bringing best talent out of India. In 2002, the Supreme Court ruled that the fees charged by private unaided educational institutes, could be regulated. Also, while banning capitation fee, it allowed institutes to charge a reasonable surplus. In 2003, the Court ruled that the fee structure in professional courses shall be approved by a committee in order to curb profiteering and charging of capitation fees.

Way Forward

Indian private education industry has been booming but the quality of education, its efficiency, effectiveness is very low. This is because private education players mainly focus to maximise their profits. With the increasing demand of higher education and government constraint to invest in it (as we see from reducing public expenditure for higher education), there is an urgent need for allowing foreign well-known universities to set up their branches in India and increase quality of education. The sudden and almost unending disruption due to COVID-19 pandemic has major impact on many higher educational institutions in the country. However, many private universities in India quickly adapted to online teaching and learning via video conferencing platforms and learning management systems customised by universities.

According to New Education Policy 2020, over the next 15 years, colleges will be given graded autonomy to give degrees. Affiliation with universities will end, and these institutions will be given the status of ‘deemed to be universities’. The New Education Policy suggests a cap on fee charged by private institutions of higher education. New breed of private institutions can supplement the highest public institutions and can establish international standards of excellence in the field of higher education in India.

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