IIMs may skip fee hike this year or increase marginally

Dip in CAT numbers raise concern over candidates' affordability

There is good news for this year's Indian Institute of Management (IIM) aspirants. Thanks to drop in CAT numbers and inflationary trends, the premier B-schools may either not increase fee at all or do so only by a small measure for their flagship management programmes.

According to most of the IIMs that Business Standard spoke to, with the number of candidates taking the Common Admission Test (CAT) not increasing much every year, the institutes feel a fee hike would further dent the registration trends.

"Fee increase is decided by the board. However, I don’t think there is an appetite for fee increase. The number of people taking CAT has not been increasing. Even if fee goes up, it would not be beyond any correction for inflation which is around 8-10 per cent. We will try to be efficient and absorb as much as cost increase as we can," said Rishikesha T Krishnan, Director, IIM Indore.

While IIM Bangalore has decided not to hike fees, the likes of IIM Ahmedabad, Calcutta, Kozhikode and newer IIMs like Udaipur are yet to take a call.  

What's more, IIM Lucknow, which in fact reduced its fees last year from Rs  12 lakh to Rs  10.80 lakh, may too maintain status quo, said institute sources.

Seconding Krishnan's views, Debashis Chatterjee, director of IIM Kozhikode added that the institute will hold back the fee as long as possible.

"We have a commitment towards sections of the country who feel that IIMs' fees are high. We are due for a hike but we will hold back as long as possible. We have not hiked our fees and charge one of the lowest fees at Rs  9.70 lakh since 2010," Chatterjee added.

On the other hand, confirming that IIM Bangalore would not hike its fees of Rs  17 lakh for the next batch of 2014-16 too, director in-charge Devanath Tirupati said that the institute looks at the affordability of students even while considering inflation and costs.

"We do consider three factors while determining the fees.  Affordability for students (and their parents is certainly important.  We also need to consider inflation and our costs for delivering a quality program. And we also keep in mind the salary package students are able to receive upon graduation as it is an indicator of their ability to repay loans and fulfill financial obligations incurred to pursue the program," Tirupati added.

At IIM-A, a senior faculty member added that due to high inflation impacting affordability of candidates, IIM-A too would either not hike fees or raise marginally.

"Since the inflation is at around 7-8 per cent, the fee hike would have to half of that at 3-4 per cent. Nevertheless, our fee waiver schemes have been able to make education at IIM-A affordable for the needy," the faculty member said.

In fact, some even think the IIMs have gone a bit overboard when it came to fee increase.

"Historically, bulk of fee hike has happened in last six years and probably, as IIMs, we have gone overboard. My sense is that bulk of the IIMs would play in the Rs  10-12 lakh for a reasonable time. We are not likely to see much increase for at least two years and everybody is going to stabilise," said Janat Shah, director of IIM Udaipur.  

The institute, which started with Rs  8 lakhs in 2011, has maintained it since last three years.

However, Shah added that the final decision will be taken by the board.

Meanwhile, last year, IIM Ahmedabad, like other IIMs, had increased its fees from Rs  15.50 lakh to Rs  16.60 lakh.  Due to infrastructural expansion, IIM Bangalore too had to hike fees last year by 15 per cent, from Rs  15 lakh to Rs  17 lakh, making its management programme the most expensive among IIMs.