By Dezan Shira & Associates
Editor: Tracie Frost
The Ministry of Human Resources Development (MHRD) of the Government of India recently announced its intent to establish a new National Education Policy (NEP). The current policy has been unchanged since 1992. MHRD’s document, “Some Inputs for Draft National Education Policy 2016,” is open for public comment until July 31, 2016. The higher education aspects of the policy are of particular interest to foreign educational institutions.
According to a report written for MHRD, nearly 300,000 Indian students study abroad, mostly in post-graduate and doctorate programs, spending about US$ 9 billion per year. Nearly half of those 300,000 students go to the United States, with the United Kingdom and Australia accounting for most of the other destinations for studying abroad. Annual spending by Indians for foreign studies is twice the amount allocated in the central government budget for higher education, and nearly 20 times what Indian higher education institutions spend on research collectively. In contrast, only 75,000 foreign students come to India, many only for short duration study programs; less than 20,000 international students are enrolled in degree programs, most of them undergraduate students from South Asia.
In recognition of the fact that many of India’s best students go to foreign universities, the report recommends that India encourage high quality foreign universities and educational institutions to collaborate with Indian partners and establish an Indian presence. The report further suggests that “while the nature and cooperation and collaboration may vary, the foreign university should be in a position to offer their own degree to the Indian students… The key essential would be the collaborating foreign partner would be among the top 200 Universities of the world… The opportunity should be used to ‘globalize’ Indian higher education without compromising the basic needs of access, equity and quality for the Indian student.”
The Indian government has long resisted allowing foreign universities to offer degrees to Indian students in India. Yet, given that only a small percentage of Indian students have a chance to be admitted into the ultra-competitive top-tier Indian degree programs, it is understandable that so many Indian students see value in studying abroad. India’s educational system currently lacks the robust institutions at national, state, and district levels that are necessary to provide and manage quality colleges. The NEP’s proposals for foreign universities seek to close the gap in creating such institutions while reforming the existing ones.
While the NEP is yet to get adopted, MHRD’s recommendations are significant for foreign educational institutions interested in investing in the Indian educational market. The draft NEP is not clear regarding how the “top 200 Universities of the world” will be defined. What is apparent though is that India may likely be selective in choosing which educational institutions are allowed to confer degrees in India. Following the adoption of the NEP, the Government may seek to codify the new policies into law through legislation. However, there is some doubt as to whether the Modi Government has sufficient support in the upper house of parliament to ratify such changes. Many interested parties, including foreign governments and higher educational institutions, have made or are planning to make comments during the comment period to encourage the adoption of the NEP.
Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email email@example.com or visit www.dezshira.com.
Stay up to date with the latest business and investment trends in Asia by subscribing to our complimentary update service featuring news, commentary and regulatory insight.
Managing Your Accounting and Bookkeeping in India
In this issue of India Briefing Magazine, we spotlight three issues that financial management teams for India should monitor. Firstly, we examine the new Indian Accounting Standards (Ind-AS) system, which is expected to be a boon for foreign companies in India. We then highlight common filing dates for most companies with operations in India, and lastly examine procedures and regulations for remitting profits from India.
Using India’s Free Trade & Double Tax Agreements
In this issue of India Briefing magazine, we take a look at the bilateral and multilateral trade agreements that India currently has in place and highlight the deals that are still in negotiation. We analyze the country’s double tax agreements, and conclude by discussing how foreign businesses can establish a presence in Singapore to access both the Indian and ASEAN markets.
Passage to India: Selling to India’s Consumer Market In this issue of India Briefing magazine, we outline the fundamentals of India’s import policies and procedures, as well as provide an introduction to engaging in direct and indirect export, acquiring an Indian company, selling to the government and establishing a local presence in the form of a liaison office, branch office, or wholly owned subsidiary. We conclude by taking a closer look at the strategic potential of joint ventures and the advantages they can provide companies at all stages of market entry and expansion.