Rajya Sabha okays bill that gives govt power over IIMs’ functioning
The Rajya Sabha has passed the Indian Institutes of Management (IIM) (Amendment) bill 2023, giving the government more control over the functioning of the premier business schools. The bill names the President of India as a "Visitor" for all IIMs, giving them powers to nominate the chairperson of the board of governors, oversee director appointments and removals, and audit the institution's functioning. The bill also designates the National Institute of Industrial Engineering as the 21st IIM. Critics argue that the bill takes away some of the independence granted to IIMs under the 2017 law.
New Delhi: The Rajya Sabha on Tuesday passed the Indian Institutes of Management (IIM) (Amendment) bill 2023, giving the government sweeping powers to control the functioning of the premier business schools.
The bill, which amends the 2017 IIM Act was passed in the upper house by a voice vote. It was cleared by the Lok Sabha on August 4.
The bill names the President of India as a “Visitor” for all the IIMs; it gives the Visitor powers to nominate the chairperson of the board of governors, oversee appointment as well as removal of directors, and audit the functioning of the institution. The bill also classifies the National Institute of Industrial Engineering (NITIE), Mumbai, as the 21st IIM in the country.
Replying to a debate on the bill in Rajya Sabha, Education Minister Dharmendra Pradhan said that the bill will fix governance accountability, and ensure “social justice”.
“Some members raised questions over why the constitutional requirements of the country including reservation in faculty recruitment are not followed in the IIMs or students from weaker sections are not admitted in these institutions. As long as we don’t fix the accountability, the institutes are not answerable to anyone. Therefore, the bill has been brought to bring that accountability while keeping academic autonomy intact,” the minister said.
Pradhan said that the amendment will strengthen the constitutional position through Parliament to ask why the IIMs have not been adhering to the central educational institutions (Reservation in Teachers’ Cadre) act, 2019. “Previously, they were not answerable. But now they will be,” he said.
During the debate, V Vijaysai Reddy, member YSR Congress, supported the bill but also raised concerns over reduction in the budgetary support to IIMs over the years.
Pradhan said that the Centre has spent more than ₹6,000 crore in setting up the IIMs. “The government is financially helping new IIMs. There is an option of HEFA (Higher Education Financing Agency, (the ministry’s joint venture with a state-owned bank) loans for all the greenfield IIMs. The IIMs are also free to fix their fees. They are also generating their internal revenue.There is no issue of funding….”
Critics of the bill have pointed out that it takes away some of the independence the 2017 law gave the IIMs. The 2017 IIM Act provides the institutes a higher degree of autonomy over its functioning, with a very limited role of the government. The board of governors of each IIM has 19 members, including one representative each from the central and state governments.
The bill that was cleared in the Rajya Sabha, however, seeks to nominate the President as “Visitor” of each IIM, with complete power to “nominate the chairperson of the board of governors”, and also have its nominee in the search-cum-selection panel for the director’s appointment.
Currently, the chairperson of the board of governors is appointed by the board itself.
Earlier this month, commenting on the bill, former IIM Ahmedabad director Bakul Dholakia supported the legislation: “Autonomy and accountability are interlinked, and while the IIM boards and the institute directors enjoy full freedom in their operations, there must be a framework for accountability which should be adopted by the board.”