The Centre on Monday approved financial schemes to execute major educational reforms in the higher and technical education sector. While it will soon set up a Higher Education Financing Agency (HEFA) to boost research-oriented infrastructure for premiere institutions like IITs, NITs and IIMs, a Technical Education Quality Improvement Programme (TEQIP) would also be launched with an aim to raise standards in educational institutions of low income States, hill States, North-East and Andaman and Nicobar islands.
HEFA will be set to provide funds up to Rs20,000 crore for building research-oriented infrastructure at IITs, IIMs and other centres of higher education. The HRD Ministry’s proposal to this effect was cleared at a meeting of the Union Cabinet chaired by Prime Minister Narendra Modi.
HRD Minister Prakash Javadekar said HEFA would be jointly promoted by an identified promoter and his Ministry with an authorised capital of Rs2,000 crore of which Government equity would be Rs1,000 crore.
Announcing the Cabinet decision on TEQIP, Javadekar said that the focus in this phase would be on seven low-income States (Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Rajasthan and Uttar Pradesh), 3 hill States (Himachal Pradesh, J&K and Uttarakhand), 8 Northeastern States (Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura) and Andaman and Nicobar Islands.
The HEFA would be formed as a Special Project Vehicle (SPV) with a PSU Bank/Government-owned NBFC as promoter and it would leverage the equity to raise up to Rs20,000 crore for funding infrastructure projects and development of world class laboratories in institutions like IITs, IIMs and NITs etc., Javadekar said.
HEFA would also mobilise Corporate Social Responsibility (CSR) funds from PSUs and Corporates, which would be released for promoting research and innovation in these institutions on grant basis, a statement released by the Ministry said.
The Government would service the interest portion through regular Plan assistance. All Centrally-funded higher education institutions would be eligible for joining the HEFA as its members. Each member institution would be eligible for a credit limit as decided by HEFA based on the amount agreed to be escrowed from the internal accruals, said an HRD Ministry statement.
“If a project is completed before time, we will provide a bonus and if it is not completed as per schedule, there can be a penalty for the entity concerned,” Javadekar said.
The Cabinet Committee on Economic Affairs also approved the proposal for initiation of the 3rd Phase of TEQIP, which will be implemented as a ‘Central Sector Scheme’ with total project outlay of Rs3,600 crore.
The HRD Ministry in a statement said that educational institutions will be chosen on the basis of a challenge mode like the competition that was held for cities under the Swachchh Bharat scheme.
Javadekar said that in the first two phases of TEQIP, southern and western States had benefited a lot so the focus is going to be on some other States in the third phase.
According to a statement released by the HRD Ministry, the project would be initiated with a cost of Rs2,660 crore, with the possibility of additional financing of Rs940 crore at later stage.