Financing of Private Higher Education Institutions in India

Abstract

The universities established in India in the post-independent period were public institutions. Many private-aided colleges affiliated to public universities were established in the subsequent period. From the 1980s, self-financing courses started in the public institutions paving the way for emergence of self-financing institutions in the private sector. Thus, privatisation of public institutions and promotion of private institutions became key elements in the expansion of higher education and increased non-state funding of higher education in India. The self-financing courses and institutions relied mostly on student fees and household financing. With the increasing social demand for higher education, the household expenditure on higher education has been increasing over the years. Based on an empirical study carried out by the Centre for Policy Research in Higher Education (CPRHE), this chapter will analyse the variations in the levels of fees for the same courses among different private institutions, factors influencing the phenomenon of rising fees in the self-financing private institutions in India and their implications for equity and affordability in higher education.