Harish MK, New Delhi

From: Harish MK <harish.p09@imi.edu>
Date: Mon, Feb 8, 2010 at 1:46 AM
Subject: Budget wishlist
To: BudgetTwentyTen@gmail.com

      The Union Budget presented in year 2009 demonstrated the commitment of Government of India towards the education sector. It saw an overall increase in allocation to the education sector by 20% from Rs.28,674 crore in year 2008 to Rs.34,400 crore in year 2009. There was a clear emphasis on higher education with announcement of establishing 16 central universities, six new IITs and IIMs. However, what was perhaps more significant was the changes to the Educational Loan Scheme of the Indian Banks' Association. The Government in order to ensure deserving/meritorious students from economically weaker sections are not denied higher education, a scheme was approved to provide full interest subsidy during the period of moratorium (i.e., course period, plus one year or six months after getting job, whichever is earlier) on loans taken by such students. The loan scheme covers all approved courses of technical and professional streams from recognized institutions in India. This scheme is currently available only to students with parental income not exceeding Rs.4.5 lakh per annum. However, a look at the fee structure of various higher education institutions such as the IIMs (which are government aided) and other private institutes shows that fee for pursuing professional courses could be anywhere between Rs.8 lakh to Rs.18 lakh. Clearly, this exorbitant fee structure is not affordable even for students classified outside the bracket of economically weaker section. Hence, an extension of the interest subsidy during the moratorium period on education loans for all students irrespective of being classified as economically weak or not would be a welcome move. Such a move will not only encourage many students to pursue higher education with greater confidence but will also win their hearts.

 

 

Thank you,

Harish MK.

International Management Institute (IMI), New Delhi