Commercial University Ltd. in New Delhi offers degrees in commerce, one of hundreds of private colleges trying to fill an education gap as India’s growth creates a middle class eager for its children to succeed.
The operation doesn’t have a campus, nor are its degrees recognized by the government. Commercial University, based in a post office building between the capital and the sprawling streets of the old city, is one of more than a dozen institutions labeled as “fake” in an alert on the website of the University Grants Commission, India’s college regulator.
Bogus degrees are a symptom of the crisis in India’s higher education that prompted Prime Minister Manmohan Singh to promise 1,000 new universities and hire S. Ramadorai, former chief of Tata Consultancy Services Ltd., to upgrade the system. Failure to prepare students for India’s new industries risks squandering the nation’s biggest competitive advantage -- the youngest population among the world’s top 10 economies -- and has forced companies led by Infosys Ltd. (INFO) to build their own colleges.
“There is a need to bridge the gap between what is required to do the job and where the education system leaves the students,” said Srikantan “Tan” Moorthy, head of education and research at Infosys, the nation’s second-biggest software company. “Bridging that gap, in our experience, takes quite some effort.”
Singh, Moorthy and overseas universities that want to build campuses in India are running out of time. India needs to add 340 million skilled workers in the next decade if the country is going to lift economic growth to 10 percent, the prime minister said.
“India can reap the demographic dividend of a young population provided the young citizens of the country are educated and possess the skills required for earning a decent livelihood,” Singh said at a skill development conference in January. “There is a significant gap between the requirement and the supply which, unless checked, will constrain our economic growth.”
The government raised spending on education by 24 percent last year to $10.2 billion and plans to add 14 universities, 374 colleges and 20 software engineering institutes. Singh hired Ramadorai, former chief of Asia’s largest software-services provider, to head a panel to advise on ways to improve skill development.
China, which produced a decade of more than 10 percent average growth to become the world’s second-largest economy, had a literacy rate in 2000 of 91 percent for people older than 15, according to the World Bank. Only 63 percent of Indians that age were literate in 2006. The median age of India’s population is 25.1 years, compared with 34.5 years in China, according to data from the United Nations.
India’s higher-education challenge is typified by its top universities -- the seven Indian Institutes of Technology and six Indian Institutes of Management that were set up after independence to provide engineers and administrators. The list has been expanded since the beginning of last decade with seven more IIMs being added and eight new IITs.
These institutes get as many as 50 applicants for each place, compared with 17 at Harvard, even though none are ranked in the world’s top 300 universities by the London-based Times Education Supplement.
Together, the IITs produce only about 9,600 graduates a year -- fewer than Moscow State University -- and many students leave to work abroad. Alumni include Ajit Jain, a potential successor to Warren Buffett at Berkshire Hathaway in Omaha, Nebraska, who went to IIT Kharagpur; and Pepsico Inc. Chief Executive Officer Indra Nooyi who earned an MBA at IIM Calcutta.