Govt offer to raise Rs 17,000 crore to finance higher education hits obstacles

The Government’s plan to raise funds of Rs 17,000 crore to finance higher education has hit a barrier.  A meeting was held between the officials from the Department of Economic Affairs, the ministry of HRD, and the HEFA with the various funding bodies with the objective of raising funds. Limitations in helping the HEFA raise funds were expressed by various funding agencies including the Housing and Urban Development Corporation Ltd (HUDCO), the Life Insurance Corporation of India (LIC), the National Bank for Agriculture and Rural Development (NABARD) and the Power Finance Corporation Ltd (PFC) Internal regulations are preventing LIC from helping HEFA in raising funds. PFC and NABARD contemplated that they are extended monetarily as they are caught up in taking care of other key government ventures. HUDCO reasoned its inability to help HEFA in raising funds as it is tasked with Central Government scheme known as Pradhan Mantri Awas Yojana which aims to provide housing subsidy to the lower and middle-income group families. There was no response from the separate e-mails sent to NABARD and LIC on Friday. No calls and messages were answered by the chairman of PFC. The E-mail sent to HUDCO also failed to get any reply. The Government has initially planned to raise Rs 17,000 crore through HEFA as extra-budgetary resources (EBR). Out of the total 17,000 crores, Rs 12,000 crore is for higher education, Rs 1,000 crore for school education and Rs 4,000 crore for medical education. The failure of the four funding bodies in helping HEFA to raise funds may affect the already planned EBR mobilisation for educational institutions. Loans of Rs 11,000 crore have already been approved by the HEFA to several higher education institutes including the Indian Institute of Technology (IITs) ahead of attaining enough funds. An official from the ministry of HRD said that

“Raising funds from the market is a tough task and we have faced the first hurdle. Negotiations are still on with at least one of the four organisations”