Rs 1,000 cr allocation for HEFA is peanuts: Deepak Nayyar

Eminent economist Deepak Nayyar today said Rs 1,000 crore allocation made in the Union budget for the proposed Higher Education Financing Agency is "peanuts".
Disagreeing with the government's decision to create such an agency in the education sector, Nayyar, also a noted academician, favoured recreating the University Grants Commission (UGC) into a higher education financing authority.
"...This financing agency with the corpus of Rs 1,000 crore... What is it going to do? Who is going to lend to it? Because any lender will look for rates of return," he said when asked if it is practically viable in Finance Minister Arun Jaitley's budgetary proposal to allocate Rs 1,000 crore to create the higher education financing agency. "Allocation made for the higher education financing agency, forgive me, is peanuts. If you feed peanuts, you will get monkeys. It is not the answer," Nayyar said during an interactive session after delivering a lecture on "Union Budget 2016 and Beyond," organised by Malayala Manorama here. In his budget speech, Jaitley had announced creation of a Higher Education Financing Agency (HEFA) with an initial capital base of Rs 1,000 crore, which will leverage funds from the market and work to create infrastructure in India's top institutions like IITs.

HEFA, Jaitley had said, would be a not-for-profit organisation that will leverage funds from the market and supplement them with donations and CSR funds.
"These funds will be used to finance improvement in infrastructure in our top institutions and will be serviced through internal accruals," theFinance Minister had said.
Nayyar said, "I think you should actually recreate the University Grants Commission into a higher education financing authority, something which the United Kingdom has done, which France has done".
Lamenting that the UGC has the same "problem" as Reserve Bank of India, he said, "They do too many things. They do disbursement, they do accreditation, they do licensing, they do certification...It is wrong."

"No one institution, nowhere in the world does this," Nayyar said.