Welcome Defence Step

Atlast the government of india has broken its stalemate over giving defence equipment manufacturing to the private companies. This will increase competition and bring out low highly effective arms.

The Times of India writes on 30 th October 2009


Indian defence companies will gain access to a potential $100 billion market over the next 10 years, following a new policy that allows
domestic firms to bid for large defence contracts, officials said on Friday.

India, one of the world's biggest arms importers, wants to increase the role of its private sector, which holds around 20 percent of the defence industry market but has the potential to grow significantly.

Under the new policy, the government will allow domestic companies to bid for key projects on their own.

Indian companies until the policy change were not invited by the government to bid for big government defence projects and were left to supplying locally made non-combative equipment for the defence forces.

With foreign countries reluctant to share advanced technology with India, the government wants to encourage private defence companies to enter the arms market, officials say.

"The field is now open for them to come and bid for any project along with the world's best. The government is giving them an opportunity to expand their capabilities," Sitanshu Kar, the defence ministry spokesman said.

Local companies are free to bid for projects involving tanks, artillery and aircrafts, Kar said.

"This move can also save costs and help us turn India into a major production hub in the near future," Kar said.

The new policy will provide more opportunities to Indian companies such as Tata Motors, Mahindra and Mahindra, Ashok Leyland and Larsen and Toubro, defence experts and officials said.

"The current review is primarily focused on two essential areas of promoting and facilitating wide participation of defence industry and enabling transparency and integrity in all acquisitions," defence minister AK Antony said at a conference.

"Over the next five to six years, the total budgetary provision for capital acquisition is likely to reach $50 billion," Antony said. Defence and company officials say it will touch the $100 billion mark in 10 years.

India wants to upgrade its largely Soviet-era arsenal to counter potential threats from Pakistan and China. The government plans to spend more than $30 billion over the next five years to upgrade its defences.

Foreign defence companies have welcomed the government move.

"The government is very forward leaning and the steps we view as a sign of the government's confidence in the maturity of the Indian industry," Vivek Lall, India country head for Boeing Integrated Defense Systems said on Friday.

Weed Out Inferior Private Institutes

Private enterprises are needed for the big country like India. But it should take the social condition into consideration. Especially the private educational enterprises are required to take note of the social inequalities before venturing into the field. The de novo institutes are money minded without giving quality and they should be weeded immediately.

Hemali Chhapia writes in The Times of India (21 June 2009)


Despite higher education being vital to a rapidly developing country like India, the government's share in higher education — in terms of
number of institutes and student enrollment — has dwindled over time. Simultaneously, academics note, the stake of profit-seeking politicians in the higher education business has risen.

In 2001, when private unaided institutes made up 42.6% of all higher education institutes, 32.89% of Indian students studied in them. By 2006, the share of private institutes went up to 63.21% and their student share went up to 51.53%. In other words, every second student in India signed up with a private institute.

Globally too, the private sector has seen opportunities in higher education, but there have been few takers in comparison to India. For instance, although there are 39.1% private higher education institutes in China, merely 8.9% students study in them. In the US, private universities constitute 59.4% of higher education institutes, but only 23.2% of American students pursue their education in them.

"It does signify that higher education in these countries is predominantly a public service," noted Ved Prakash, vice chancellor of the National University of Education Planning and Administration (NUEPA). Academics in India have researched on how public spending by the Union and provincial governments has fallen. In his work, Prakash notes that between 2002 and 2006, deemed universities — or 'doomed universities' as one academic waggishly described them — grew by a whopping 96%. In the same time span, central and state universities grew by a modest 11% and 22% respectively.

This unabated growth without any quality check has forced academics from Harvard University to scrutinize this sector and note, "The rapid expansion of capitation fees colleges came about as a result not of great middle-class pressure or demand, but rather the entrepreneurial activities of politicians."

Even the Supreme Court recently expressed its concern about the quality of education in private institutes and the corruption that is rampant there. Within private higher education, the professional streams have seen the maximum growth.

Private engineering colleges, which accounted for just 15% of seats in 1960, now account for over 85% according to data from the All-India Council for Technical Education, the regulatory body for professional technical education. From a tiny base in 1970, medical colleges in the private sector have grown by an eye-popping 900%. The private sector now accounts for over 45% of medical colleges in the country.

In 2006, Sanat Kaul in his paper ‘Higher education in India: Seizing the opportunity’ highlighted instances of a single politician running more than 100 educational institutes. "There are rampant cases of malpractice in the form of illegal charges for allocating seats from the management quota. Income tax raids have revealed that seats are sold for cash, and a medical seat can fetch as much as Rs 25 lakh. The black money involved runs into thousands of millions of rupees," Kaul observes in his study funded by the Indian Council for Research on International Economic Relations.

But none of this has elicited any action from the government. And naturally so. In their 2004 paper, ‘Indian higher education reform: From half-baked socialism to half-baked capitalism’, Devesh Kapur and Pratap Bhanu Mehta, both fellows of Harvard College, argued that politicians who had been sugar and liquor barons had turned to higher education as an industry because of its high returns.

"Even as political parties rail against de jure privatization, de facto privatization continues unabated," they noted. Kapur and Mehta acknowledged that while there was no statistical data, "there is little doubt that a majority of private institutions have been supported or made possible by the direct involvement of politicians."

Arun Nigavekar, former chairman of the University Grants Commission, said private institutes have been granted recognition without a sense of responsibility. "Time and again, the HRD ministry has failed. There is a need for a surgical process to undo certain decisions taken by it," he said.

Echoing Nigavekar, academics say that minister for science and technology Kapil Sibal will not only have to untangle some policies set by his predecessor, but also work to ensure high quality in public higher education.