The new IIMs have come a long way since they first took flight a decade ago, but still struggle to attract quality students and faculty. How does this impact the brand?
IIM-Rohtak has ₹46 crore pending from the ₹333 crore budget, but will require significant additional funds to complete the campus as planned
Image: Madhu Kapparath
It’s as easy as A-B-C. Any management student in India can tell you that.
For generations now, the hierarchy of the coveted Indian Institutes of Management (IIMs) has been denoted by the simple strain of the alphabet. By value of prestige, the chain goes: IIM-Ahmedabad or IIM-A; IIM-Bangalore or IIM-B; and IIM-Calcutta or IIM-C. That sequence remains dominant even today, almost six decades after the first IIMs were established in Ahmedabad and Kolkata in 1961, and now when 20 IIMs stand ground.
This is part of the problem.
The IIMs can be categorised into three generations. The first set, referred to as the ‘older IIMs’, are IIM-A, IIM-C (established in 1961), IIM-B (1973), IIM-Lucknow (1984), IIM-Indore (1996) and IIM-Kozhikode (1997). The hierarchy remains largely sequential, in order of establishment.
Then comes the second-generation, colloquially called the ‘new IIMs’. The previous government pushed for the expansion of quality management institutes, setting up seven new IIMs about a decade ago—these are at Shillong (which began its first academic session in 2008-09); Rohtak, Raipur, Ranchi, Tiruchirappalli or Trichy (functioning since 2010-11); and Udaipur and Kashipur (started from academic year 2011-12). All of these were until recently operating from makeshift campuses.
Even before this fledgling generation of IIMs could be fully functional, a third generation of IIMs was set in motion in 2015-16. The six ‘Baby IIMs’, as they are called, have been established at Amritsar (Punjab), Bodh Gaya (Bihar), Nagpur (Maharashtra), Sambalpur (Odisha), Sirmaur (Himachal Pradesh) and Vishakhapatnam (Andhra Pradesh). A seventh was later announced at Jammu, which started its academic sessions a year later.
While it is too soon to assess the quality of the baby IIMs, which still work out of makeshift campuses and don’t attract the same level of students as the previous IIMs would, it’s a good time to take stock of the new IIMs, a decade after the first began operations.
Money Matters
Over the past few months, all the second-generation or new IIMs have shifted base to permanent campuses, with the exception of IIM-Ranchi. Each new IIM was allocated ₹333 crore to build their campus, and the government was contemplating granting them an additional ₹300 crore to each to tide over the rising expenses. However, recent news reports say the Centre has decided against this additional funding as it wants the institutes to be self-sufficient.
The Indian Institutes of Management Act 2017, which came into effect in January 2018, granted autonomy to all 20 IIMs, so that they can appoint their own directors, decide their own fee structure and award degrees instead of diplomas, among other features. Reports say that in the spirit of autonomy, the government would like for the IIMs to raise their own funds too.
“This works in the case of the older IIMs, which generate their own revenue and can manage their operational finances,” says P Rameshan, professor at IIM-Kozhikode and former director of IIM-Rohtak. “But, for the newer IIMs, most of them have only completed their first phase of construction. An equal amount will be needed for their next phase.”
IIM-Udaipur and IIM-Trichy have spent the entire ₹333 crore and used up additional funds too; the other new IIMs are likely to receive the pending amount, which ranges from ₹27 crore to IIM-Kashipur to ₹263 crore to IIM-Ranchi, which acquired land for its permanent campus only in 2016.
“While we have received no official intimation about this, we have heard it might be a possibility,” says Dheeraj Sharma, director, IIM-Rohtak. “At Rohtak, we have completed Phase 1 of construction at the permanent campus, but have Phase 2 and 3 remaining. I would urge and request the government to reconsider capital funding.”
IIM-Rohtak has about ₹46 crore pending from the original ₹333 crore budget, but estimates that it will require significant additional funds to complete the campus as planned. Sharma says that 50 percent of the campus is now complete.
“ We have completed Phase 1 of construction at the permanent campus, but Phase 2 and 3 remain. I would request the government to reconsider capital funding.”
Dheeraj Sharma, Director, IIM-Rohtak
(This story appears in the 18 January, 2019 issue of Forbes India. To visit our Archives, click here.)