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IIM-A announces 11.44% fee hike, highest in last 5 years

After refraining from revising fee last year, the Indian Institute of Management, Ahmedabad (IIM-A) has now announced a fee hike of 11.44% for its post graduate programme in management (PGP) and PGP food & agri-business management (FABM) for the 2015-17 citing inflationary pressures. At 11.44%, the fee hike will be highest in last five years.

The institute has announced that the fee for its PGP and PGP-ABM programmes will increase from the current Rs 16.6 lakhs to Rs 18.5 lakhs by 11.44%, while the PGPX course fee is also being raised from Rs 21.5 lakhs to Rs 24.0 lakhs for the batch commencing from April 2015.  According to IIM-A, since the last revision made for the 2013-15 batch, inflation has been on the rise is projected at eight% for 2014.

During the past two years, CPI inflation rate in India was 9.7% in 2012 and 10.0% in 2013; it is projected at 8.0% for 2014, the institute stated as reason for revising the fee.  “One of the other reasons we are hiking the fee is to remain financially autonomous. We believe those students who go on to grow in their career after studying here should be the ones bearing the cost of IIM-A education as opposed to tax payers,” said Ashish Nanda, director of IIM-A.

Year   *Fee   %change
    (in Rs. lakhs) against previous year
2010-12   13.7    
2011-13   14.5   5.80%
2012-14   15.5   6.89%
2013-15   16.6   7.09%
2014-16   16.6   0%
2015-17   18.5   11.44%
*Total fee for PGP and PGP-FABM  

Moreover, in order to bring in more diversity in PGP and PGP-FABM programmes, the institute announced two major initiatives including offering deferred admission to a subset of selected students to give them an opportunity to work for a couple of years before joining IIMA. “Deferred admissions will encourage some of our bright admits fresh out of college to gain relevant work experience before joining the program so that they can benefit from, and contribute to, the PGP program even more than they  would have otherwise,” said Nanda.

Further, the institute is also introducing supernumerary seats for foreign nationals. IIM-A will offer seats over its present capacity to foreign students who want to join the PGP course. “Our objective is to get quality foreign students to bring in diversity, and also to position the institute as a global learning destination for management students,” said Ajay Pandey, Dean Programs, IIM-A.  The institute is mulling rationalisation of GMAT cut-off to attract more foreign nationals to the institute.

“However, we will make sure the quality (of foreign nationals) is comparable to what is demanded of domestic candidates in the admission process,” Nanda added.  The institute is also mulling following the MHRD’s Direct Admissions of Students Abroad (DASA) scheme which calls for setting aside additional seats for foreign nationals equivalent to 10% of the regular batch size. Both PGP and PGP-FABM put together, the current total batch size for both first and second year is roughly over 860.

For the PGP and PGP-ABM programs, the tuition fee increase is 10%, whereas administrative costs (for hostel, facilities, academic support, etc.) have increased at a higher pace owing to inflation, resulting in a net increase of 11.44%. The cumulative fee increase for all three programs, of the order of about 11.5%, equates to about 3.7% annual increase over the three years, the institute informed.

“Even as the institute raises its fees, we emphasise our commitment committed to providing generous financial aid and working intensively with financial institutions to make educational loans easily available, so as to ensure that capable students continue to be able to join IIMA irrespective of their financial means. We have tried to cover increasing costs by focusing on efficiency, reducing cross-subsidization of other programs, support from executive education, increasing income from corpus, and intensifying fund-raising,” said Ashish Nanda, director of IIM-A.

However, amidst increasing cost pressure, the institute has continued extending financial support to students. IIM-A disbursed financial aid of Rs 7.55 crore to 295 students in 2012-13 and Rs 6.94 crore to 242 students in 2013-14. IIM-A has also worked intensively with financial institutions such that currently several banks are offering incoming students loans covering 100% of their educational cost.

Meanwhile, in other steps taken at the institute, Nanda stated that certain changes are being made in PGP and other programs.  For instance, as per PGP review committee’s recommendations, the incoming batch of PGP 2015-17 will see introduction of new core courses like ‘Government Systems & Processes’,’Understanding Global Organisational Context’, ‘Having an Entrepreneurial Mind-set’, and ‘Experiencing Integration’, apart from allowing flexibility for students to specialize in specific domains (such as Marketing, Finance, and HR) on their meeting specified credit requirements in those domains.

On the other hand, as per the recommendations of the PGP agri-business management (ABM) review committee, the program is being restructured and renamed as post graduate programme in food and agribusiness management (PGP-FABM) even as it is being opened up to non-agriculture background students to bring in more diversity in terms of academic backgrounds.


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