''These fees are already extraordinarily high without any rationale,'' Dr Murli Manohar Joshi said, commenting on an announcement by the Indian Institute of Management, Bangalore. A senior Human Resource Development Ministry official reached tonight said the IIMs were autonomous institutions and denied knowledge of the latest fee hike.
As HRD Minister four years ago, Dr Joshi fought an IIM fee hike to Rs 150,000 a year, ordering it cut to Rs 30,000-- as charged by Indian Institutes of Technology.
Unlike the IIMs, the IITs have to spend on expensive scientific equipment and labs, Dr Joshi pointed out. India's six IIMs between them were estimated then to enrol 1,400 students.
Dr Joshi said a study the Ministry commissioned at the time showed that United States government-sponsored business schools charged about US$ 8,000 a year when American per capita income was US$ 24,000 a year.
The fees in India should also relate to ''our per capita income, which is about Rs 24,000 a year,'' Dr Joshi said.
''This new move is mind-boggling and without logic,'' Dr Joshi said, pointing out that as it is the IIMs hardly ''attend to India's management needs-- look at any sector, water, power, railways, airports, transport, education and cooperatives.'' He said, for most part, the IIM graduates appear to cater to the needs of the corporate sector, especially transnational corporations-- not mainstream India.
The latest fee hike was announced by the IIM in Bangalore for Postgraduate courses from Rs 2.5 lakh to Rs five lakh.
IIM Director Pankaj Chandra told journalists the fees for the first year would be Rs 400,000 and, for the second, Rs 500,000.
He explained it as a result of ''the increase in the cost of conducting the programme.'' He also announced an increase in scholarships to students from economically weaker sections from Rs 91 lakh to Rs 1.5 crore from 2008-09.
Until the early 1990s, the IIMs charged students some Rs 20,000 a year in fees. In a decade, their fees rose to about Rs 150,000 a year, the hikes largely fuelling IIMs' growing corpus funds.
An IIM-Ahmedabad study in March 2004 argued that the HRD Ministry's fee reduction order ''violates the time honoured process of the fee being decided by the Board of Governors''.
It held that ''it is not necessary to reduce fees to (make) management education more affordable to the less well-to-do.'' But India's former Comptroller and Accountant General V K Shunglu, hired to study 'Financial Requirements and other Related Issues of IIMs (April-2004),' questioned several IIM financial practices and called for accountability.
Shunglu's study raised questions of accountability of various autonomous institutions. ''In many of the autonomous institutions, reduced accountability and non-reporting appeared to have been construed as essential elements of autonomy.'' Shunglu held that ''in the present situation, any schemes based on grant of scholarships to encourage and thereby enable poorer students in joining IIMs are unlikely to succeed.'' He cited how a leading American school had decided to reduce fees, although ''the most successful student loan assistance programme is available in USA, not only for MBA but for all other programmes.
''Taking into account the experience of this programme, it has been decided by Harvard -- a private University -- to reduce the fees.'' The impasse was ended shortly after Arjun Singh replaced Dr Joshi and invited the IIMs heads to take a common position.