India: Foreign Campuses In India - UGC Notifies Regulations Allowing Foreign Higher Educational Institutions To Set Up Campuses In India

The long wait of having access to foreign university courses for Indian students seems to be getting shorter as the Government of India has allowed higher-ranked foreign universities of repute to set up its campuses in India. The University Grants Commission ("UGC") on November 8, 2023, published the University Grants Commission (Setting up and Operation of Campuses of Foreign Higher Educational Institutions in India) Regulations, 2023 ("FHEI Regulations")¹ allowing higher-ranked foreign universities and educational institutions to set up its campuses in India, to offer certificate, diploma, degree and research programmes at the undergraduate, postgraduate, doctoral and post-doctoral levels. Previously, a draft of the FHEI Regulations was released by the UGC in January this year for public feedback (please refer to our earlier article here² on the detailed framework of draft FHEI Regulations, 2023). We discuss hereinbelow some of the key changes made to the provisions in draft and other key aspects introduced under the FHEI Regulations which have not been a part of the earlier draft of FHEI Regulations:

1. Additional Eligibility: The FHEI Regulations requires the applicant foreign higher education institution ("FHEI") intending to establish campus in India to either have secured a position within the top 500 in the overall category of global rankings, as decided by the UGC from time to time, or should have secured a position within the top 500 in the subject-wise category of global rankings or possess outstanding expertise in a particular area, as decided by UGC from time to time. Lack of guidelines or criteria as to what would constitute as an outstanding expertise in a particular area allows UGC wide discretionary powers.

2. Collaboration between two or more Foreign Higher Education Institutions: The FHEI Regulations has introduced the opportunity for two or more FHEIs to collaborate for setting up campuses in India, in which case each participating FHEI is required to meet the eligibility criteria stipulated under the FHEI Regulation. Also, the FHEI is entitled to set up more than one campus in the country subject to submission of separate application for each proposed campus with the UGC.

3. Extension of time for processing of applications: The timeline provided to the Standing Committee (constituted to examine and assess the applications for establishment of campuses) for its recommendations to the UGC has been extended from 45 (forty-five) days under the draft of FHEI Regulations to 60 (sixty) days from the date of the receipt of completed application. Similarly, the timeframe provided to UGC for grant of initial in-principle approval and issuance of letter of intent to the FHEI to set up campuses in India as well as the grant of final approval to FHEI to commence the operation of a campus has also been increased to 60 (sixty) days.

4. Omission of provisions related to renewal of operations: Notably, the draft FHEI Regulations provided that the initial permission to the FHEI to commence operations would be granted for a period of 10 (ten) years. This obligation has been omitted under the notified FHEI Regulations. Consequently, the requirement of seeking renewal of operations of the campus at least 1 (one) year before the expiry of the approved period from the UCG for another period of 10 (ten) years has been removed. This omission grants certainty and finality to the establishment of FHEI's campus without seeking periodic renewals.

5. Annual fee payment: Unlike the draft, the FHEI Regulations has omitted the requirement for FHEIs to pay annual fees to the UGC (from second year onwards) except for a one-time application fee.

6. Admission and fee autonomy: The FHEI's have been given wide autonomy to evolve its admission process and criteria to admit domestic and international students and decide the fee structure. In addition to the scholarships which may be provided by the FHEIs in their discretion, the FHEI Regulations also encourages the FHEIs to provide tuition fee concessions to students who are Indian citizens. Interestingly, this power to decide the fee without any fetters so long it is transparent and reasonable (without any guidelines) gives the FHEIs greater autonomy than the Indian counterpart colleges and institutions.

7. Minimum stay of foreign faculty: While the draft FHEI Regulations had vaguely stated that a foreign faculty appointed for Indian campuses is mandated to stay for a reasonable period, the FHEI Regulations has laid down that a foreign faculty must stay in India for a minimum period of one semester. The intent it to provide continuity of lectures to students for the entire semester of the course.

8. Online mode of education: While the draft of FHEI Regulations had completely barred offering of programmes in online or open and distance learning modes, the FHEI Regulations allows for lectures in online more not exceeding 10% (ten per cent) of the programme requirements.

9. Parity with qualification offered: The FHEI Regulations requires the qualifications offered in the campus by FHEI to be awarded under the name and seal of the FHEI in the country of origin and such qualification should enjoy the same recognition and status as if they were conducted in its home jurisdiction. This requirement protects the interest of students and grants equal recognition to the qualifications awarded in India and the home country.

10. Easy repatriation of funds: Cross border movement of funds, remittances and repatriation, if any will need to be in accordance with the applicable foreign exchange regulations. Interestingly, the FHEI Regulations do not prescribe any restrictions or conditions on repatriation of funds from the campus so long as they are in compliance with the applicable foreign exchange laws i.e., remittance of surplus may be allowed from the campus to FHEI. This relaxation is being widely debated by Indian institutions who do not have the power to transfer surplus funds from one institution to the other considering its not for profit structure.

11. Compliance: The FHEI Regulations now require a FHEI to ensure compliance under the Foreign Contribution (Regulation) Act, 2010 ("FCRA") in case of receipt or utilisation of foreign contribution by any person. In this regard, FHEI is required to obtain permission of the Central Government prior to receiving or utilizing donation from foreign sources. Also, the annual audit report to be submitted to the UGC must certify that its operations in India is compliant with the provisions of FCRA. This addition is an onerous compliance for the FHEIs and is intended to curb any routing of unaccounted funds to India.

12. Joint venture: The FHEI Regulations allows a FHEI to enter into a joint venture with Indian higher educational institutions or an Indian Company. However, sharing of infrastructure is not permitted and the FHEI is required to have its independent campus with the physical, academic and research infrastructure and facilities required to conduct its academic and research programme. Considering the requirements above, the nature of joint ventures with Indian educational institutions being envisaged needs to assessed.

13. Jurisdiction of Indian courts: The FHEI Regulations has specified that in case of any disputes under FHEI Regulations, courts in India will have exclusive jurisdiction.

Conclusion

The FHEI Regulations notified by the Government marks a significant stride in the internationalisation of education in India which is in tandem with the vision of the National Education Policy (NEP) 2020. The FHEI Regulations has broadened the scope for joint initiatives by FHEIs by permitting the FHEIs to collaborate with other FHEIs to establish campuses as well as enter into joint ventures with Indian higher educational institutions. The compliance obligations of FHEI have been strengthened as they will need to obtain prior permission of the UGC before starting any new programme and also comply with the stringent legal requirements under the FCRA for receipt or utilisation of foreign funds. Considering the massive outflow of billions of foreign exchanges by students studying abroad, the FHEI Regulations is a welcome development intended to promote the growth of setting up of international campuses with opportunity for students to avail world class curriculum and education in India. The intent is to provide a robust framework for FHEIs to operate in India by giving them autonomy to recruit faculty and staff and determine its admission and fee policy while also balancing the interests of Indian students and ensuring that the academic standards are not compromised.

Footnotes

1 https://www.ugc.gov.in/pdfnews/Setting%20up%20and%20Operation%20of%20Campuses%20of%20Foreign%20Higher%20Educational%20Institutions%20in%20India.pdf

2 "Will UGC's Draft Regulations Change The Indian Higher Education Landscape" (https://www.mondaq.com/india/education/1273068/will-ugcs-draft-regulations-change-the-indian-higher-education-landscape)