Quotas are not the issue

Everyone flags or rather flogs India’s demographic dividend now. Populations in developed countries are aging. China is also graying. Where in the world will you get a population with a median age of 24? The dependency ratio will drop by another five percentage points in the next few years. Even if India’s savings (and investment) rates are below East Asian levels, this human capital will propel India into the 8 per cent-plus growth trajectory. In some countries in East Asia, this demographic transition added two incremental percentage points to GDP growth. Why can’t India replicate this? However, for this demographic dividend not to turn into a demographic deficit, we need literacy, skills and lower levels of morbidity and mortality. We need health and education, the kinds of targets set out in the Millennium Development Goals (MDGs). In addition, most of this demographic dividend will accrue in the Hindi heartland, where present health and education indicators are the worst. Forget health for the moment and let us focus on education, in all its three variants — school, vocational and higher, with an emphasis on the higher segment.

Is higher education desirable? Of course it is, although not everyone gets into higher education, provided a sensible exit point exists at the vocational and school-leaving stage. Returns to higher education are considerable, in the 20 per cent-plus range. Based on enrolment ratios in some countries in East Asia, the targeted official enrolment figure in higher education seems to be 10 per cent and we are at 8 per cent now, up from 6 per cent at the beginning of the Tenth Plan (2002-07).

First ask, is there a shortage of seats in higher education? The temptation is to believe there is a shortage, since at this time of the year there is a scramble for seats. But in a macro sense, there is no shortage, there is excess supply. Ignoring polytechnics and other institutions that award diplomas and certificates, there are 217 universities, 74 deemed universities, 13 institutions of national importance, 85 research institutes, 9,427 general colleges, 1,068 engineering, technical and architecture colleges, 783 medical colleges, 900 teacher training colleges and 1,991 other colleges. The enrolment in higher education is 10 million. Assume any reasonable figure for capacity in these institutions of higher education and work backwards. You will find that we can easily handle an enrolment of 15 million, without adding a single institution of higher education or a single seat. Obvious points are often missed and so is this one. Because most of these institutions offer junk, there is no demand for seats there. And there is excess demand for a few that offer quality. That’s where the scramble is.

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