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The Banks have adopted an education loan scheme (‘Scheme’), following the revised Model Scheme formulated by Indian Banks Association to provide need- based assistance to meritorious students to pursue higher education. Eligibility criteria stipulated under the scheme says:- the applicant should have secured admission to a higher education course in recognized institutions in India or...
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The Banks have adopted an education loan scheme (‘Scheme’), following the revised Model Scheme formulated by Indian Banks Association to provide need- based assistance to meritorious students to pursue higher education. Eligibility criteria stipulated under the scheme says:- the applicant should have secured admission to a higher education course in recognized institutions in India or abroad through Entrance Test/Merit based selection process after completion of HSC (10 plus 2 or equivalent). The Scheme specifies that a student who has obtained admission to an eligible course through a merit based selection process alone could be considered as a meritorious student. The classification made, enabled the Banks to consider a ‘meritorious student’ eligible for the benefits under this scheme, which also include such a student admitted under management quota.
The term ‘meritorious’ has been defined, if the student has obtained admission to an eligible course through a merit based selection namely admission to professional and technical courses through common entrance tests. It specified that where the admission is made purely based on marks scored in qualifying examinations, the bank may fix cut- off marks (percentage) for loan eligibility. The Management Seats or the Management quota in private colleges ,wherein the management has discretion to grant admission on factors other than merit, it was resolved that such seats do not qualify for being termed meritorious and hence any loan considered by the banks for students getting admission under the management quota would be outside the purview of the Scheme.
The State Level Banker’s Committee held on 22-12-2011 (‘SLBC’) had sought to evolve uniform guidelines for granting educational loan, to support the large number of students who have joined different courses in various colleges under Management Quota securing admission to seats through Entrance examinations conducted by private self- financing colleges in Kerala State. It is subsequently modified as applicable for students getting admission both within and outside Kerala State for admissions under the management quota which had been kept outside the scope of the Model IBA scheme. The Banks in pursuance to the deliberations churned out at the SLBC had adopted the same and passed necessary directives in the form of circulars to be followed as regards the loan to be sanctioned under the Meritorious and Management quota respectively. As per the provisions of the circular, the admission to courses outside Kerala will be deemed to be under the Management Quota except where the admission is through common entrance examination like CAT, MAT, GATE, All India Medical and Engineering Entrance Test, NIIT or any common entrance test conducted by Government of India /approved regulatory bodies. The above criteria do not apply to nursing courses where the fees are restrictive (as decided by the respective state government /regulatory authority). Hence, admissions to nursing courses within and outside the state are treated as merit admissions. It would be pertinent to note the criteria regarding sanctioning of educational loan to the student obtaining selection under the Management quota, the qualification prescribed is a minimum of 50% mark both for the qualifying examination and for qualifying subjects individually ( For instance, -(1) Physics, Chemistry and Mathematics for Engineering; (2) Physics, Chemistry and Biology for Medical/Nursing Courses) respectively.
The discussions in the aforementioned paragraphs would condense our thoughts in respect of educational loan to the realm of the sagacious responsibility undertaken by the state to facilitate the means of education by providing the timely assistance to the students who are meritorious. The paradigm of insisting mandatory criteria on a uniform basis even in the loans advanced on management quota would succor to the national objective of improving the educational sector by pruning it to modulate itself to the goal of attaining education in a higher level aimed at overall national growth and prosperity. It would be beneficial to take cue from the land mark judgment of High court in Jiby John v State of Kerala (2011(2) KHC 575) wherein it was ruled that “basic objective of the national policy and the Scheme formulated, accepted and sought to be implemented by the Government is to identify the talented/meritorious candidates, who do not have necessary financial infrastructure to pursue higher studies and to make available necessary funds to promote the cause of Education. This is applicable to every citizen. If all the children of a poor parent are highly meritorious and are securing admission for higher studies, each one deserves a helping hand to bring them to the main stream providing a more solid educational foundation, in turn leading to better economic development of the society at large”.
It would be apposite to note that the recent trend in the grant of educational loan is where applications are seen preferred on a fashion basis and everybody wants to plunge into reap the benefits on a cursory and perfunctory basis. The objective of providing benefits under the Revised Model Educational Scheme was only to ensure the availability of timely assistance to qualified students to enable them pursue their higher studies in terms of the scheme. The rationale behind such objective was the outcome of the studies of the National Commission on Population, which foresaw the drastic changes in population tide in the years to follow .It is expected that by 2016 as per the demographic dividend approximately 50 per cent of our total population would be in the age group of 15-25 years. Before further delving in the matter, the proper understanding of the concept of ‘demographic dividend’ would be viable and proper. The ‘demographic dividend’ in simple terms could be explained as the bulge in the population of the working age group of 15-60 which would present as a luscious boon towards pushing the economic growth of our country. It is probable that the entry of the individuals of the aforementioned group to the various vocations in the employment sector, wherein their potentials could be harnessed effectively and efficiently, leading to increase in productive activities and also savings rate as the economic transition that occurred in the ‘land of rising sun’ Japan in the 1950s and neighboring Communist regime ruled country in 1980s which enabled them to be the powerful economies of today ( See Indian Education System-Issues and Challenges- Address by Dr K. C. Chakrabarty, Deputy Governor, RBI at JRE School of Management, Greater Noida on August 5, and 2011. www.reservebankofindia.nic.in as on 04-04-13). It is submitted that even though that there would be shortage of workforce globally, the same wouldn’t affect us, as the average Indian will be only 29 years old in 2020 as compared with 37 years for China and the U.S., 45 years for West Europe and 48 years for Japan. Hence it is evident, that there would be a tremendous increase in the number of employable work force in the job market which would demand commensurate investment in education. The investment in education could be viewed in the following perspectives (a) Establishment of Model centres of excellence (b) Imparting knowledge and training on advanced courses (c) Raising the educational standards in par with International norms of accreditation.
Having discussed the educational field, let us now look at scenario of the educational loans disbursed by the various commercial banks across the country. It would be staggering to note that though the benefit under the Scheme has been extended up to 25.8 lakhs accounts, the amounts outstanding has swelled up to Rs 52982.85 Crores (www.gconnect.in as on 08-04-13). The comparative analysis is given below:-
YEAR AMOUNT OUTSTANDING ACCOUNTS
(Rs Crore) (Lakhs)
Mar-09 Rs 27709.5 16.3
Mar-10 Rs 35854.67 19.11
Mar-11 Rs 41341.84 22.11
Mar-12 Rs 46727.48 23.73
(31-03-12) Rs 52982.85 25.08
As seen from the statistics above, though it would be elating to note that the benefits of the Scheme had been extended to the needful in large, the returns /repayment had been writ small adding to the woes of the lending institutions and overall economic security of the country. It is also disheartening to note that a quite large number of students who gain the benefit of the cream of the scheme, fly out to seek greener pastures in other countries thus depriving our country the benefits of profundity in return, it expects from her country men. While speaking about increasing the quality of education, necessary proactive steps should be taken to make it in par with renowned centers of excellence and to equip the intellectual Indian minds to surge ahead in the field of knowledge and understanding.
Much water has flown through the Ganges, much oration ,much less inscription has been made on the aspect of loss of Indian brain which should have provided succor to the
Development of our country free from poverty, ignorance, eradication of epidemics, lack of basic amenities etc; as a whole. Let us remember at this juncture the great visionary of our country ,the true statesman, first Prime Minister of our country Pandit Jawaharlal Nehru in his historic speech titled ‘Tryst with destiny’ addressed to the nation on the eve of our Independence has rightly remarked “The service of India means the service of millions ,who suffer. It means the ending of poverty and ignorance and disease and inequality of opportunity. The ambition of the greatest man of our generation has been to wipe every tear from every eye.” But unfortunately aspirations of these wordings have not been materialized so far.
By increasing the quality of education, one doesn’t need to harbor a view that investment in infrastructure and innovation of intellectualism would be to ape itself to the foreign system of education, as blind acceptance of alien principles would be puerile and counterproductive to the interests of the nation. What is desirable is better development of growth and proper utilization of our own resources and rising to the standards of competitive nature with the educational system of other countries.
Where have we Indians lost the track of intellectual wisdom and reasoning that we possessed in the pre historic times? Where we have lost our self- growth? We lost our self sustenance and independence blindly trying to adopt practices alien and impracticable to our circumstances. The foreign imperialistic powers tried everything possible that would scuttle and constrict the growth of the Indians. The acceptance of new ideas is not a taboo, but the same should not be the sole reason to limit or belittle the status of our individual Indian intellectualism. The India of today should equip itself to lead the future of millions tomorrow. The quest of reasoning for obtaining education should be addingof value to oneself and spread its fragrance all around like beautiful butterflies on the lively green meadows, though however small they seem, yet without haste they do so, seeking nectar from thy flowers, spreading the pollen grains of the plant elsewhere to bestow a new sap of life. Small their efforts may seem so, but with punctilious pace and brimming happiness inside they move the cyclical chain forward as granted by their eco system. We should hence strive ourselves in a symbiotic relationship to work towards progress and development of our mother country in military power and economical prosperity without whose enrichment we would not have been there to see the horizon of today. Let the transition of change take place without undermining and underrating our country, its rich and varied heritage with the dream of seeing her as a developed one dedicating our efforts to make India a super power among the world nations.
Coming back to our topic of discussion, the following probabilities may be probed into/ considered while sanctioning/substituting economic assistance in education on a twin fold basis i.e. qualitatively and quantitatively to improve and revamp our education sector and ensuring national growth and economic prosperity:
(a) Creation of corpus fund by the Government for every new born child ,to be maintained annually and permitted to be withdrawn only, till the child completes HSC Education or becomes a major whichever is earlier.
(b) Insisting on a mandatory provision in the loan agreement that the applicant shall work in India for a minimum period of 4 years.
(c) Creation of Insurance facility by the Government, so as to encourage banks and other financial institutions to sanction loan to all deserving students.
(d) New Institutions with advanced courses to be started on a private –public partnership basis to improve the quality of education.
(e) Grant of subsidies to State Governments towards improving the quality and creating newer educational standards in par with the international accreditation standards based on the literacy level of the concerned state. In states, where the literacy level is above the overall national level, funds to be allocated to elevate the educational system to a higher pedestal. In states where the literacy level is low, necessary steps /studies to be undertaken to improve the level of literacy.
(f) Foreign universities to be allowed to set up their branches in India in collaboration with Indian Universities with frequent student exchange policy.
(g)Establish new teacher training institutes with novel techniques to equip themselves to surge ahead to impart quality level education.
(h)Unfilled seats on the merit quota in the private institutions to be declared open after the scheduled time or 6 months whichever is earlier enabling the management to fill the same as from their quota, with a precondition that 25% of the fee collected in this regard would be channelized to the Government funds on education to be started in this regard, the same of which shall be maintained in the savings banks account of a Nationalized Bank under the joint custodianship of both the parties.
(i) Managements who fail to fill up the seats allocated to them both in Merit and Management quota over a period of 3 years to lose the benefit of such number of seats in such proportion as they remain unfilled towards the said period.
(j) Foreign direct investment to be permitted in Educational sector, with tax waiving benefits for a period of 30 years.
(k) Creation of job opportunities in Private/ Public Sector with reservation up to 50% based on the meritorial aspects alone to be implemented as a part of the National Plan towards achieving development on an overall basis.
These are some of the suggestions that could be considered while granting benefits on a national basis to ensure overall development and growth of our Country. The floccinaucinihilipilification of the pains and sufferings undertaken by our forefathers for our country should be avoided to promote the progress of our nation in the various walks of life. To pen down, let us just bestow our attention to the words of former flamboyant President of United States of America John F.Kennedy who said as follows:-
“Ask not what your country can do for you;
Ask what you can do for your country”.
The author is an Advocate at High Court of Kerala. He holds a B.A.LL.B (Honours) degree from National University of Advanced Legal Studies (NUALS), Kochi.
The term ‘meritorious’ has been defined, if the student has obtained admission to an eligible course through a merit based selection namely admission to professional and technical courses through common entrance tests. It specified that where the admission is made purely based on marks scored in qualifying examinations, the bank may fix cut- off marks (percentage) for loan eligibility. The Management Seats or the Management quota in private colleges ,wherein the management has discretion to grant admission on factors other than merit, it was resolved that such seats do not qualify for being termed meritorious and hence any loan considered by the banks for students getting admission under the management quota would be outside the purview of the Scheme.
The State Level Banker’s Committee held on 22-12-2011 (‘SLBC’) had sought to evolve uniform guidelines for granting educational loan, to support the large number of students who have joined different courses in various colleges under Management Quota securing admission to seats through Entrance examinations conducted by private self- financing colleges in Kerala State. It is subsequently modified as applicable for students getting admission both within and outside Kerala State for admissions under the management quota which had been kept outside the scope of the Model IBA scheme. The Banks in pursuance to the deliberations churned out at the SLBC had adopted the same and passed necessary directives in the form of circulars to be followed as regards the loan to be sanctioned under the Meritorious and Management quota respectively. As per the provisions of the circular, the admission to courses outside Kerala will be deemed to be under the Management Quota except where the admission is through common entrance examination like CAT, MAT, GATE, All India Medical and Engineering Entrance Test, NIIT or any common entrance test conducted by Government of India /approved regulatory bodies. The above criteria do not apply to nursing courses where the fees are restrictive (as decided by the respective state government /regulatory authority). Hence, admissions to nursing courses within and outside the state are treated as merit admissions. It would be pertinent to note the criteria regarding sanctioning of educational loan to the student obtaining selection under the Management quota, the qualification prescribed is a minimum of 50% mark both for the qualifying examination and for qualifying subjects individually ( For instance, -(1) Physics, Chemistry and Mathematics for Engineering; (2) Physics, Chemistry and Biology for Medical/Nursing Courses) respectively.
The discussions in the aforementioned paragraphs would condense our thoughts in respect of educational loan to the realm of the sagacious responsibility undertaken by the state to facilitate the means of education by providing the timely assistance to the students who are meritorious. The paradigm of insisting mandatory criteria on a uniform basis even in the loans advanced on management quota would succor to the national objective of improving the educational sector by pruning it to modulate itself to the goal of attaining education in a higher level aimed at overall national growth and prosperity. It would be beneficial to take cue from the land mark judgment of High court in Jiby John v State of Kerala (2011(2) KHC 575) wherein it was ruled that “basic objective of the national policy and the Scheme formulated, accepted and sought to be implemented by the Government is to identify the talented/meritorious candidates, who do not have necessary financial infrastructure to pursue higher studies and to make available necessary funds to promote the cause of Education. This is applicable to every citizen. If all the children of a poor parent are highly meritorious and are securing admission for higher studies, each one deserves a helping hand to bring them to the main stream providing a more solid educational foundation, in turn leading to better economic development of the society at large”.
It would be apposite to note that the recent trend in the grant of educational loan is where applications are seen preferred on a fashion basis and everybody wants to plunge into reap the benefits on a cursory and perfunctory basis. The objective of providing benefits under the Revised Model Educational Scheme was only to ensure the availability of timely assistance to qualified students to enable them pursue their higher studies in terms of the scheme. The rationale behind such objective was the outcome of the studies of the National Commission on Population, which foresaw the drastic changes in population tide in the years to follow .It is expected that by 2016 as per the demographic dividend approximately 50 per cent of our total population would be in the age group of 15-25 years. Before further delving in the matter, the proper understanding of the concept of ‘demographic dividend’ would be viable and proper. The ‘demographic dividend’ in simple terms could be explained as the bulge in the population of the working age group of 15-60 which would present as a luscious boon towards pushing the economic growth of our country. It is probable that the entry of the individuals of the aforementioned group to the various vocations in the employment sector, wherein their potentials could be harnessed effectively and efficiently, leading to increase in productive activities and also savings rate as the economic transition that occurred in the ‘land of rising sun’ Japan in the 1950s and neighboring Communist regime ruled country in 1980s which enabled them to be the powerful economies of today ( See Indian Education System-Issues and Challenges- Address by Dr K. C. Chakrabarty, Deputy Governor, RBI at JRE School of Management, Greater Noida on August 5, and 2011. www.reservebankofindia.nic.in as on 04-04-13). It is submitted that even though that there would be shortage of workforce globally, the same wouldn’t affect us, as the average Indian will be only 29 years old in 2020 as compared with 37 years for China and the U.S., 45 years for West Europe and 48 years for Japan. Hence it is evident, that there would be a tremendous increase in the number of employable work force in the job market which would demand commensurate investment in education. The investment in education could be viewed in the following perspectives (a) Establishment of Model centres of excellence (b) Imparting knowledge and training on advanced courses (c) Raising the educational standards in par with International norms of accreditation.
Having discussed the educational field, let us now look at scenario of the educational loans disbursed by the various commercial banks across the country. It would be staggering to note that though the benefit under the Scheme has been extended up to 25.8 lakhs accounts, the amounts outstanding has swelled up to Rs 52982.85 Crores (www.gconnect.in as on 08-04-13). The comparative analysis is given below:-
YEAR AMOUNT OUTSTANDING ACCOUNTS
(Rs Crore) (Lakhs)
Mar-09 Rs 27709.5 16.3
Mar-10 Rs 35854.67 19.11
Mar-11 Rs 41341.84 22.11
Mar-12 Rs 46727.48 23.73
(31-03-12) Rs 52982.85 25.08
As seen from the statistics above, though it would be elating to note that the benefits of the Scheme had been extended to the needful in large, the returns /repayment had been writ small adding to the woes of the lending institutions and overall economic security of the country. It is also disheartening to note that a quite large number of students who gain the benefit of the cream of the scheme, fly out to seek greener pastures in other countries thus depriving our country the benefits of profundity in return, it expects from her country men. While speaking about increasing the quality of education, necessary proactive steps should be taken to make it in par with renowned centers of excellence and to equip the intellectual Indian minds to surge ahead in the field of knowledge and understanding.
Much water has flown through the Ganges, much oration ,much less inscription has been made on the aspect of loss of Indian brain which should have provided succor to the
Development of our country free from poverty, ignorance, eradication of epidemics, lack of basic amenities etc; as a whole. Let us remember at this juncture the great visionary of our country ,the true statesman, first Prime Minister of our country Pandit Jawaharlal Nehru in his historic speech titled ‘Tryst with destiny’ addressed to the nation on the eve of our Independence has rightly remarked “The service of India means the service of millions ,who suffer. It means the ending of poverty and ignorance and disease and inequality of opportunity. The ambition of the greatest man of our generation has been to wipe every tear from every eye.” But unfortunately aspirations of these wordings have not been materialized so far.
By increasing the quality of education, one doesn’t need to harbor a view that investment in infrastructure and innovation of intellectualism would be to ape itself to the foreign system of education, as blind acceptance of alien principles would be puerile and counterproductive to the interests of the nation. What is desirable is better development of growth and proper utilization of our own resources and rising to the standards of competitive nature with the educational system of other countries.
Where have we Indians lost the track of intellectual wisdom and reasoning that we possessed in the pre historic times? Where we have lost our self- growth? We lost our self sustenance and independence blindly trying to adopt practices alien and impracticable to our circumstances. The foreign imperialistic powers tried everything possible that would scuttle and constrict the growth of the Indians. The acceptance of new ideas is not a taboo, but the same should not be the sole reason to limit or belittle the status of our individual Indian intellectualism. The India of today should equip itself to lead the future of millions tomorrow. The quest of reasoning for obtaining education should be addingof value to oneself and spread its fragrance all around like beautiful butterflies on the lively green meadows, though however small they seem, yet without haste they do so, seeking nectar from thy flowers, spreading the pollen grains of the plant elsewhere to bestow a new sap of life. Small their efforts may seem so, but with punctilious pace and brimming happiness inside they move the cyclical chain forward as granted by their eco system. We should hence strive ourselves in a symbiotic relationship to work towards progress and development of our mother country in military power and economical prosperity without whose enrichment we would not have been there to see the horizon of today. Let the transition of change take place without undermining and underrating our country, its rich and varied heritage with the dream of seeing her as a developed one dedicating our efforts to make India a super power among the world nations.
Coming back to our topic of discussion, the following probabilities may be probed into/ considered while sanctioning/substituting economic assistance in education on a twin fold basis i.e. qualitatively and quantitatively to improve and revamp our education sector and ensuring national growth and economic prosperity:
(a) Creation of corpus fund by the Government for every new born child ,to be maintained annually and permitted to be withdrawn only, till the child completes HSC Education or becomes a major whichever is earlier.
(b) Insisting on a mandatory provision in the loan agreement that the applicant shall work in India for a minimum period of 4 years.
(c) Creation of Insurance facility by the Government, so as to encourage banks and other financial institutions to sanction loan to all deserving students.
(d) New Institutions with advanced courses to be started on a private –public partnership basis to improve the quality of education.
(e) Grant of subsidies to State Governments towards improving the quality and creating newer educational standards in par with the international accreditation standards based on the literacy level of the concerned state. In states, where the literacy level is above the overall national level, funds to be allocated to elevate the educational system to a higher pedestal. In states where the literacy level is low, necessary steps /studies to be undertaken to improve the level of literacy.
(f) Foreign universities to be allowed to set up their branches in India in collaboration with Indian Universities with frequent student exchange policy.
(g)Establish new teacher training institutes with novel techniques to equip themselves to surge ahead to impart quality level education.
(h)Unfilled seats on the merit quota in the private institutions to be declared open after the scheduled time or 6 months whichever is earlier enabling the management to fill the same as from their quota, with a precondition that 25% of the fee collected in this regard would be channelized to the Government funds on education to be started in this regard, the same of which shall be maintained in the savings banks account of a Nationalized Bank under the joint custodianship of both the parties.
(i) Managements who fail to fill up the seats allocated to them both in Merit and Management quota over a period of 3 years to lose the benefit of such number of seats in such proportion as they remain unfilled towards the said period.
(j) Foreign direct investment to be permitted in Educational sector, with tax waiving benefits for a period of 30 years.
(k) Creation of job opportunities in Private/ Public Sector with reservation up to 50% based on the meritorial aspects alone to be implemented as a part of the National Plan towards achieving development on an overall basis.
These are some of the suggestions that could be considered while granting benefits on a national basis to ensure overall development and growth of our Country. The floccinaucinihilipilification of the pains and sufferings undertaken by our forefathers for our country should be avoided to promote the progress of our nation in the various walks of life. To pen down, let us just bestow our attention to the words of former flamboyant President of United States of America John F.Kennedy who said as follows:-
“Ask not what your country can do for you;
Ask what you can do for your country”.
The author is an Advocate at High Court of Kerala. He holds a B.A.LL.B (Honours) degree from National University of Advanced Legal Studies (NUALS), Kochi.