IIM autonomy closer as Lok Sabha clears Bill, right to award degrees likely

Now goes to RS; more autonomy to 20 institutes; oppn hails it but raises concern at high fees

The Lok Sabha on Friday passed the Indian Institute of Management (IIM) Bill, aiming to give 20 IIMs more autonomy and reducing the scope for government interference.

The IIMs would, when the Bill passes the Rajya Sabha, too, and then get Presidential assent, become institutes of national importance and given the authority to grant degrees, on the lines of Indian Institutes of Technology (IITs). Currently, the IIMs are bodies registered under the Societies Act and not authorised to award degrees. They were awarding a postgraduate diploma and fellow programmes in management. These were treated as equivalent to MBAs and PhDs, respectively; however, this equivalence was not universally acceptable.

"I am delighted. I hope the Rajya Sabha passes it and the President gives his assent. The onus now lies on the leadership of the IIMs to take advantage of the autonomy that has been offered to truly become world-class. We need to strive better than before," IIM-Ahmedabad director Ashish Nanda told Business Standard.

IIM Bangalore director G Raghuram also hailed the move. "It was not that the government was breathing on our necks. But, now, with greater autonomy, we will be able to undertake some things on our own such as expansion, fees, appointment of director and chairperson," he said.

Prakash Javadekar, minister of human resource development (HRD), said the aim was to remove government interference in the functioning of IIMs. "It is a historical bill, which will bring a new era in management education in the country," he told the Lok Sabha.

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After the Bill becomes law, each IIM will be governed by its board of governors, which will appoint its chairman for a period of four years and a director for five years. The BoG will comprise four eminent members from the realms of education, industry, commerce, social service and public administration; five alumni/society representatives; three women members, two faculty representatives; and a member each from the central and state governments. Its director will automatically be a member and one member will be from a schedule caste or tribe.

The board is to be the principal executive body, to function in line with the regulations framed by it. "The board wouldn't need approval from the government, which also doesn't have power to give directions," said an MHRD official.

Similarly, the academic council of each IIM will consist of the director, deans, all professors and invited eminent persons. The government, however, will have its nominee in the coordination forum, comprising the secretary for higher education, two state secretaries on rotation for one year, four chairpersons of the IIMs on a rotation basis for two years, all directors and five eminent persons for three years. The coordination forum will be notified by the government.

The central government would also make rules to give additional powers and duties to the board, to decide terms and conditions of service of directors, and determine allowance for members of the coordination forum," the government official added. The rules framed by the central government and regulations by the boards will be laid before Parliament. The government has also made provisions for the Union comptroller and auditor general t go through the accounts of each IIM.

The Bill found support from the principal opposition party, the Congress. "It was a remarkable moment, when a minister surrenders (his) powers," said ex-minister Shashi Tharoor. He, however, suggested the government should have kept a say in determining the fee structure in IIMs. Other opposition speakers also expressed concerns regarding the amounts charged by these institutes. Nagendra Kumar Pradhan (BJD) said the IIMs charge between Rs 9 lakh and Rs 20 lakh for each student and with the limited number of seats, students have to opt for private MBA institutes.

With the passage, IIMs can confer degrees

• Each IIM will have an executive in the form of board of governors (BoG) comprising up to 19 members

• Of the 19 members, 17 are eminent persons, faculty members and alumni

• Two members will be nominees from the central and state governments

• BoG will appoint director of each IIM  

• Each IIM to have an academic council to determine academic content; criteria and process for admission to courses; and guidelines for conduct of examinations