| He also questioned the Centre's "intervention" in the IIM issue. He was delivering the convocation address at IIM Ahmedabad on "Economics, politics and governance". |
| According to him, the critical issue is not the fees that the IIM charges, but the entry policy and the cost per student. |
| "If the entry is competitive and a particular level of cost, after due scrutiny, is found to be justified, then any teaching institution_through pricing, endowment, subsidy or a combination of these_has to recover the cost. Otherwise, it will either go out of business or the quality of its output will deteriorate," he said. |
| If the government in its wisdom, Jalan said, decides to further subsidise and reduce the fees that a particular institution charges to cover its costs, then the question is: why this larger subsidy from public funds, and for whose benefit? |
| According to him, if the government decides to subsidise specialised technical or management education by more than what is necessary, from the public interest point of view, it is legitimate for the public to ask: why should the government increase subsidy even for those who can pay? |
| Instead of making government expenditure more equitable for society as a whole, an across-the-board subsidy of this type makes the system more inequitable and less progressive, he pointed out. |
| He also threw light on the subject : Who should govern the IIMs_their own managements or the government of the day? |
| "Personally, I feel sad at the confrontation among different constituents, particularly at the level to which this debate has deteriorated because of excessive intervention. The question is not only whether governmental intervention on an issue of this type is right or wrong. But the whole tone and tenure of the official position is a matter of concern for the future health of our polity," he said. |
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