Govt funds 80% IIT expenses,students pay back a fraction

IIT council recommends conditional fee hike of Rs 2 lakh yearly as students pay fraction of costs.

Over 80 per cent of the financial needs of the IITs and their entire capital costs are currently funded by the government. The tuition fee collected from a B Tech student is Rs 2 lakh over four years; the expenditure is about Rs 8 lakh.

The over-dependence on government funds,coupled with the widening gap between actual costs incurred and tuition fee charged,has long been considered a major deterrent to the IITs efforts at financially independence. This is one of the key aspects cited in a government report. The IIT Council has now recommended a conditional fee hike to Rs 2 lakh yearly,subject to approval by the Finance Ministry.

The root of the autonomy challenge lies in the inability of the IITs to be financially independent… Being largely funded by the government,the IITs are subjected to government spending regulations and audit. The IITs ability to invest is also constrained by the spending curbs of the government. This has put the IITs at a disadvantage compared to many reputed universities around the world which have full financial autonomy, said the report,filed by a committee appointed by the HRD Ministry.

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The revenue sources of the seven best established IITs include student fees,government receipts,investments and others (entrance exam fee,library fee,sponsorships etc). Their total operating revenues was Rs 942 crore in 2009 and Rs 1,283 crore in 2010,with 82 per cent coming as grants from the government. The return on endowments and investments as well as donations from alumni account for about three per cent of the operating revenues as against 10-40 per cent for top US universities.

Experts said increasing the tuition fee is just one way of raising funds. Industrial consultancy and generation of income from IPR are two areas where the IITs must concentrate more, said an IIT-Bombay alumnus.

The committee had also recommended that all ministries provide a minimum of 20 per cent overheads without a ceiling on the research and development projects sanctioned to the IITs. This is necessary to avoid strain on institute resources as they undertake enlarged R&D activities. Most US universities charge overheads to the tune of 50 per cent. Industrial consultancy and royalty,alumni and industrial grants/donations and continuing education programmes,would be some other modes for enhancing IIT finances, the report said.

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