On fee hike, IIM Ahmedabad says 'used corpus for upgrading 60 years old main campus'

NEW DELHI: The ministry of education today told the Lok Sabha that the investment of the Indian Institute of Management Ahmedabad (IIM-A) increased by Rs 136 crore in one year from the financial year 2019-20 to 2020-21. These corpus are used for construction, upgradation, maintenance of the 60 years old main campus.

Responding to a question whether the said investments increased by Rs 136 crores in one year alone implying that the tuition fees of Rs 105 crores were collected to be banked, the minister of state for ministry of education Subhas Sarkar said: “Tuition fee of Rs 105 crore is one of the receipts. The other receipts were through Executive Education programmes, consulting fees.”

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“As reported by IIM-A, cumulative investment was Rs 1,345 crore as on 31.03.2021,” the ministry said.

The questions of IIM Ahmedabad fee hike were based on the tweet by Maheshwer Peri, founder of Careers360 . He in a series of tweets said how the hike in fee by 575% in the past 15 years has made the IIMs “unaffordable”.

In 2020, the IIM-A revenue from academics was Rs 202 crore. Of these, Rs 105 crores were tuition fees. “As of March 2021, IIM-A invested Rs 1,345 crore in government securities, term deposits etc. In one year alone, the investments increased by Rs 136 crore implying that the tuition fees of Rs 105 crore were collected to be banked,” he wrote on Twitter.

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Stating that IIM Ahmedabad will generate a surplus in excess of Rs 75 crore every year. “The yearly increase in fees reflects lethargy of the board that refuses to challenge an yearly norm nor understands the Raison D etre' of public institutions,” he said.

Maheshwer Peri had posted a fee receipt for the academic year 2020-21 and said that the “IIMA earned Rs 118 crore as interest/dividend in 2021. That is more than the entire fees collected”.

“For a country starved of funds for education, IIMs increase fees every year and invest the surplus to earn 8% when the inflation is 6%,” he added. The fees of IIMA have risen from Rs 4 lakh in 2007 to Rs 27 lakh.

"The IIMs don’t need to raise fees each year. They are rich, slush with funds, generate massive surplus and could charge just 1/3 and still be in surplus," Careers360 founder wrote.

Maheshwer Peri, founder of Careers360, of which News By Careers360 is a part.