Begging for a World Class University

Consider this scenario. Someone you know imprisons his grown up children and does not allow them to go out and do jobs that they are fully capable of doing. He also locks up his productive assets and prevents his children from using them. Then he goes around begging his neighbors for help with feeding his family as he does not have any income. The words that spring to mind upon considering this man’s behavior are words like contemptible, immoral, stupid, pathetic, pitiable, and sad.

Those words sprung to my mind when I read an article “India at foreign door for varsity – Appeal for help after half a century” in The Telegraph (Calcutta, India.)

New Delhi, May 27: India has asked Britain for financial and technical assistance to set up a new “world class” university (WCU), nearly half a century after it last asked for foreign help in starting a premier education institution.

Junior higher education minister Purandeswari Devi has also asked her British counterpart Bill Rammell for assistance in upgrading facilities and teaching standards at the Indian Institutes of Technology, government officials told The Telegraph.

I hang my head in shame to see India debased so pathetically. Indians are second to none when it comes to talent, drive, hard work, and entrepreneurial ambition. Whenever they have had the freedom to do so, Indians have demonstrated all those through their considerable success. Until very recently, those success stories have mainly been associated with Indians abroad because it was in free countries such as the US that they had the freedom to achieve their destiny. The government of India, until very recently, following the enlightened policies of socialism, denied its citizens the freedom to achieve, to build, to compete in the world, to serve domestic and foreign markets. To the limited extent that the government has deviated from its avowed socialistic goals of scaling the commanding heights of the economy by controlling every minute aspect of the economic lives of its citizens, the people and corporations of India have prospered and gained global respect and attention.

Why does the government of India continue to imprison the educational system even now? What is the reason that it will not allow Indians the freedom to build educational institutions in India? Why does the government then go out with a begging bowl to foreign governments asking for help with building “world class universities” when Indians are quite capable of doing so?

Do you have any doubts that Indians can build world class institutions of learning? Let us recall that the world’s best universities were in India once upon a time. That was a time when India did not have “The Ministry of Human Resource Development of the Government of India” and did not have a minister for higher education or an education minister. Do you have any doubts that India has world class scholars and professors? Just two days ago I had the honor of meeting two celebrated Indian professors — both working in world class universities abroad. You cannot examine the faculty list of any top class American university without picking out dozens of Indians on it.

Why, oh, why does the government of India have to imprison the education sector? There may be many reasons for India’s pathetic economic performance. (Yes, ladies and gentlemen, let’s be honest about this. India is pathetically poor. Sure the GDP is growing at a respectable rate after decades of 2 and 3 percent Nehru rate of growth but that growth rate is on a really small base. India’s per capita GDP of US$700 cannot be compared to the per capita GDP of the US of US$28,000.) It is my opinion that one of the primary reasons is that its education system is flawed. It is also my considered opinion that the reason for India’s pathetic educational system is that the government has total control over it.

So back to the question: why does the government control the educational system? I believe it does so because it is the life-blood of the economy. By controlling that, it gains a stranglehold on the economy which it can exploit for its objective of extracting every bit of rent that it can. Let’s remember that government is made up of people — the bureaucrats and politicians. People are motivated by self interest. Through their control, they gain personally in terms of power, prestige and most importantly money. Like any monopolist, these people limit the supply of educational opportunities and then ration out the limited supply to favored groups to buy their allegiance. Reservations based on caste, religion and other non-relevant criteria are obvious symptoms of this rent-seeking rationing.

Control is the operative word. The last paragraph of that Telegraph article is revealing. It says,

The universities will be controlled by the Centre but kept distinct from existing central universities, and will be nurtured to compete with institutions like Harvard and Cambridge.

Centralized micro-level control is inimical to growth and development at the macro-level. We have to continually refer to those sectors where the government has relinquished control (even partially) and note how those sectors have prospered. And why shouldn’t they prosper? As I never tire of pointing out, there is nothing inherently lacking among Indians that they cannot build world class companies. It need not be necessarily so but the broad generalization is forced on one after even a cursory examination of India’s economy that the Indian government is the greatest impediment to India’s economic growth, and that the government of India is perhaps the greatest enemy of the Indian people.

Allow me to quote some more from the Telegraph:

Sources said Purandeswari told Rammell at a meeting in Delhi yesterday that India needed assistance in modernising teacher-training programmes in higher education.

Faculty support — a euphemism for greater participation of guest lecturers from the foreign country — was another request put forward by Purandeswari, the sources said, adding that she also dwelt on skill development — educating students for the job market — as a “key issue”.

Rammell is learnt to have told the minister that the UK was in the process of restructuring its own skill development process, and was willing to share its experiences.

The two ministers are expected to meet again in London on July 18 or 19.

The sources said India, at yesterday’s meeting, indicated its desire to firm up details of the plan before the end of the year. Higher education secretary R.P. Agrawal asked Rammell if the deal could be finalised by July, but the British minister evaded any commitment to a timeline. [Emphasis added.]

Now why would the British government official not be overly eager to help India in this regard? Let me try to answer that. If my allegiance were to Britain, the last thing I would like to see is that India become so successful in the education sector that it hurts British interests. In fact, I would wake up every day and give thanks to the gods that the Indian government has crippled India’s education system and thus ensured that Britain continues to gain from the flight of human capital from India. Lacking educational opportunities in India, those among the talented Indians who can afford it are forced to go to the UK and the US for higher education. Once there, they add to the human capital of those foreign countries as they settle down and further enrich their adopted countries. I don’t blame them. Humans value freedom like they value the air they breathe: without it, they suffocate and die.

(Aside: Just moments ago, the power failed. Yesterday afternoon where I live in Pune, the power failed about a dozen times, with outages ranging from a few minutes to half an hour. God alone knows how long this failure would be. Power here is predictably unpredictable. My laptop power will last about 3 hours and I just hope that the power returns before too long. You need not ask which agency is responsible for power in Pune. It is the Maharastra State Electricity Board — a government undertaking. Now back to the current rant.)

So will the US and the UK help out India build world class universities in India? Like hell they will. Indians are forced to spend billions of dollars each year in education abroad. (Estimates are of the order of US$10 billion annually.) They have to be stupid to do something that will hurt their national interest. They will not only lose the income from providing education to India, they will lose out on the added human capital. And most of all, they will lose jobs that Indians educated well in India can do in India.

Here’s a story from the NY Times of April 4, 2007, which should scare the pants off of the Americans: India’s Edge Goes Beyond Outsourcing. They are witnessing job flight to India on a scale that they had not anticipated. Corporations such as Boeing, Morgan Stanley, Eli Lilly, Accenture, IBM, Airbus, Cisco, and Microsoft are mentioned in the context of the number of jobs they are transferring to India. Here’s a bit:

With multinationals employing tens of thousands of Indians, some are beginning to treat the country like a second headquarters, sending senior executives with global responsibilities to work there. For example, Cisco Systems, the leading maker of communications equipment, has decided that 20 percent of its top talent should be in India within five years; it recently moved one of its highest-ranking executives, Wim Elfrink, to Bangalore, the center of the Indian industry, as chief globalization officer.

(Just by the way, last month I met Wim Elfrink at the opening of a Cisco Systems training and development center in the Zensar campus in Pune.)

So what is happening over here? Globalization. It is the erasing of national boundaries with respect to jobs that can be outsourced through the magic of the recent revolution in information and communications technologies (for services) and manufacturing jobs through the magic of the 52-year old shipping container revolution. Transnational corporations shifting jobs wherever they find labor-cost arbitrage opportunities.

Yes jobs are moving to India. So far, the foreign corporations are picking up the low-hanging fruits among the employable in India. But that well (to mix metaphors shamelessly) is going to go dry very soon. From the NYT article:

. . .specialists warned that a continued flow of work to India required drastic improvements in its educational system and basic facilities. Water and power shortages are endemic, and industry experts predict that India could lack 500,000 engineers by 2010. Yet the country has already tapped a deep well of English-speaking engineers, attracting more outsourced work than any other country.

(Oh goody, the power just came back on. Now I can save this draft and continue my rant.)

Within just two years, India will face a shortage of half a million engineers! If that is so, the labor-cost advantage of India will most certainly disappear as the price of engineers will be bid up. As it is the reported churn among software engineers in India is phenomenally high and wages are going up 30 percent per annum by some estimates.

Wouldn’t liberalizing the educational system be the most rational response to solve the shortage of skilled manpower? Yes, it would. Will it be done? Not if India continues to have a ministry of higher education and a minister of education of the likes of Arjun Singh.

Economist Alan Blinder has characterized outsourcing as “the third Industrial Revolution.” The first one was missed thanks to the British: they were the colonial power ruling India and it was not in their interest to see that India become an industrial giant. I don’t blame the British. If I was a loyal Britisher, I too would not like to hurt Britain’s interests. The second industrial revolution (I am guessing) that Blinder refers to is the off-shoring of manufacturing that mainly happened to the East Asian tigers and later to China. India missed that because of the Nehruvian socialist policies of barriers to foreign investment, archaic labor laws, xenophobia’s, and plain old fashioned stupidity.

This third industrial revolution bus is about to depart. India does not seem too eager to get on that one. No, I take that back. Indians are desperately impatient to get on this one. They are struggling to get on board. But the government of India is doing its best to prevent that from happening. It is as if the government is saying, “Just try to get on that bus and we will break your kneecaps for you. Don’t you dare escape from our clutches.”

If I had my way, I would charge junior higher education minister Purandeswari Devi with treason for having debased the country by begging a foreign nation for assistance with doing something that Indians can do. She has shamed Indians and implied that Indians are incapable of creating world class universities. I think that all Indians in the education professions — both at home and abroad — should tar and feather her for her direct insult at them. Shame on you, Ms Devi. Just resign from your post and go beg for a living instead of feeding at the taxpayers’ expense — the tax payers whom you insult so deeply.

End of rant.