Learning Curve

Sanjit Das for TIME / Panos
Indian students attend Prof. Oishik Sircar's (right) class at the Jindal Global University in Sonipat, Haryana, India.

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As more American universities look to plant their colors in India, they too may find the learning curve steeper than expected. Inconsistent regulation, the rise of private operators and political gamesmanship make finding a credible partner a tricky undertaking. In 2002, the Indian state of Chhattisgarh passed legislation allowing it to set up private universities by executive order. Within a week, it received 134 applications and approved 97. Nearly 100 upstart universities sprang up in Raipur, the state capital, alone. The "campuses" often consisted of a single room in a commercial complex or in an apartment. Two years later, the government amended the bill, requiring that the universities deposit almost $450,000 with the local government in order to operate.

"In India there is a nexus of business, politics and education as a nonprofit venture that is completely muddying the water," says Rahul Choudaha, an associate director at World Education Services, a nonprofit organization that monitors international education credentials. "The opportunity exists. Interest exists. But the challenges so far have been much more than expected."

India is in the midst of a higher-education revolution. The funds-starved public-university system has been unable to keep up with demand, giving way to a swell of private colleges. India has 20,000 higher-education institutions the most of any country in the world and three times as many as exist in the U.S.

As private education expands, it becomes harder to regulate. In 2007, Indian Prime Minister Manmohan Singh declared that 2 out of 3 universities and 90% of colleges were rated below average in India. India's public universities are tightly regulated, since the country attempts to correct entrenched disparities of caste and class. Most privately financed institutions are able to skirt oversight, allowing them to charge higher fees for tuition.

Much of the private investment in higher education has been aimed at improving profits, not academics, says Pratap Bhanu Mehta, director of the Center for Policy Research in New Delhi. "You have to be legally not-for-profit, but the intent of setting up these institutions is to generate wealth for operators." Earlier this year, the Indian government yanked the accreditation of 44 universities with 200,000 students across 13 states because they were being run as "family fiefdoms." "There is a realization that things have gotten out of control," says Philip Altbach, director of the Center for International Higher Education at Boston College. "I've said to colleges in the U.S.: You've got to be careful. It's the Wild West."

Most of the private operators offer professional courses in engineering, management and medicine, but only a small segment of them are formally recognized. For students, that means their degree does not qualify them to take a government job or pursue a graduate degree.

What private operators advertise instead are jobs. Amity University, the largest private university in India, with 50,000 students, advertises "100% placements" for prospective students. Even in the absence of official recognition, students with few options pay sums that sometimes rival those paid to American universities.

Attempts at reform have proved difficult, in part because many politicians have financial stakes in private institutions. India's Aviation Minister, Praful Patel, runs a family educational trust that operates 70 schools and 12 colleges in his home state, which generate some $40 million in tuition fees. Transportation Minister Kamal Nath runs a chain of Institute of Management Technology colleges. Billionaire industrialist and Member of Parliament Naveen Jindal founded Jindal Global Law School in his state last year.

"It's big business for politicians," says Pratap Bhanu Mehta. "They had an advantage over other genuine educational entrepreneurs because they were able to manipulate the regulatory system." In September, five members of the upper house of India's Parliament who opposed greater regulation of private universities were reported to have undisclosed financial stakes in private institutions.

This makes for difficult terrain for American colleges looking to get a foot in the door while maintaining their standards. "Across the whole landscape of Indian higher education, at the institutional level, the concept of quality is considered an add-on, not a necessity," says Choudaha. Public universities lack the funds and admissions flexibility to attract most foreign partners. That makes finding collaborators a challenge.

Despite these perils, private colleges are the partners of choice for American institutions. Over the past decade, foreign universities have collaborated almost exclusively with unrecognized, non-degree-granting private institutions, says Sudhanshu Bhushan, director of the Department of Higher and Professional Education at the National University of Educational Planning and Administration in New Delhi. That includes schools from Georgia State to the Wharton business school at the University of Pennsylvania.

The American schools, true to their nation's entrepreneurial heritage, see the opportunity as too ripe to pass up. After years of negotiation, S.K. De Datta hopes Virginia Tech's perseverance pays off with a campus of its own. "It's late, but I'm glad it's coming," he says.

Time.com

Learning Curve

American universities are rushing to set up shop in India. But local entrepreneurs have the inside track