Indian Institute of Management (IIM) Amendment Bill 2023

What’s in today’s article?

• Why in News?
• Background
• What is the Purpose of Indian Institutes of Management (Amendment) Bill, 2023?
• How is This Change Proposed to be Effected?
• What is the Current Process of Appointment of the Director?
• How Does the Bill Seek to Alter This Process?
• Other Significant Proposed Amendments in the Bill
• Why Has the Government Proposed These Amendments?

 

Why in News?

• The Central government has brought a Bill in the Parliament giving itself significant say in the appointment and removal of Directors of the Indian Institutes of Management (IIMs), and in initiating inquiries.
• The proposed changes in the Indian Institutes of Management (Amendment) Bill, 2023 have triggered concern over their potential to erode the autonomy of the IIMs.

 

Background of Indian Institutes of Management

• The Indian Institutes of Management (IIMs) are institutions of excellence, established with the objectives of –
  • imparting high quality management education and training,
  • conducting research and
  • providing consultancy services in the field of management to various sectors of the Indian economy.
• IIM-Calcutta was the first Indian Institute of Management, established in 1961. Currently, there are 20 IIMs in the country.
• The Indian Institute of Management Act, 2017 provides for the creation of an academic council for each IIM.
• This academic council is the principal academic body under the Act as it decides the –
  • (a) academic content;
  • (b) criteria and processes for admissions to course; and
  • (c) guidelines for conduct of examinations.

 

What is the Purpose of IIM (Amendment) Bill, 2023?

• The Bill seeks to amend the Indian Institutes of Management Act, 2017.
• Under the 2017 Act, the Director of an IIM is appointed by a Board of Governors, and the government has a limited say in the process.
  • Before the 2017 Act was passed, the Ministry of Education (formerly known as Ministry of Human Resource Development) used to appoint IIMs’ directors, chairpersons and board-members.
• The proposed amendments essentially seek to alter this situation, and to give the government an expanded role in the appointment of the IIM Director.

 

How is This Change Proposed to be Effected?

• Section 5 of the amendment Bill says that the President of India shall be the “Visitor of every Institute’” covered under the IIM Act.
• The Bill prescribes three primary roles for the Visitor –
  • to make appointments,
  • to audit the working of institutions, and
  • to conduct an inquiry

 

What is the Current Process of Appointment of the Director?

• Currently, the Director is appointed from the pool of names recommended by a search-cum-selection committee which is constituted by the Board.
  • The Board comprises of a chairperson, along with three members chosen from amongst eminent administrators, industrialists, educationists, scientists, technocrats and management specialists.

 

How Does the Bill Seek to Alter This Process?

• The Amendment Bill requires the Board to obtain prior approval of the President before appointing a Director.
• Since the actions of the President are on the aid and advice of the Union Council of Ministers, this change essentially means the Ministry of Education can veto the choice of the Board.
• The Amendment Bill also seeks to give the government a say in the initial selection process.
  • The Bill proposes that the four-member search-cum-selection committee to recommend names for the Director to have one member nominated by the Visitor (i.e. the President), and only two other “eminent” members (instead of three).
• Under the proposed amendments, the Board will be required to obtain prior approval of the Visitor to remove the Director as well.

 

Other Significant Proposed Amendments in the Bill

• The Bill seeks to take away the power of appointment of the Chairperson from the Board, and to instead make the Chairperson a nominee of the President.
  • Currently, the chairperson is appointed by the Board.
• Also, the Bill proposes that the President may appoint one or more persons to review the work and progress of any Institute and to hold inquiries into the affairs.

 

Why Has the Government Proposed These Amendments?

• The Indian Institutes of Management (Amendment) Bill, 2023 represents the government’s rethink on the autonomy of IIMs.
• Over the last four years, the Union government and the IIMs have had difference of opinions on several key appointments.
• For example, the Director of IIM Rohtak was given a second term by the institute’s Board of Governors despite objections from the government.
  • The government had cleared the appointment for the first term in February 2017, but had objected to a second term after it emerged that the first term was illegal.
  • The institute’s Board went ahead anyway.
• Earlier in 2019, former Gujarat IPS officer Rajnish Rai was appointed assistant professor at IIM Ahmedabad.
  • The Ministry of Education had written to IIM-A, asking why Rai had been appointed when he was under suspension.
  • The institute had defended the appointment.
• Also, the President of India is the visitor of all the Central Universities and IITs and appoints their vice-chancellors and directors.

 

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Q1) When was Ministry of Education changed to Ministry of Human Resource Development?

In 1985, the Ministry of Education was renamed the Ministry of Human Resource Development. With the public announcement of the newly drafted "National Education Policy 2020" by the Narendra Modi government, the Ministry of Human Resource Development was renamed back to the Ministry of Education.

 

Q2)  When was Article 21A added to the Constitution?

Article 21A is added in the Indian Constitution in the 86th Constitutional Amendment Act 2002. It enshrines free and compulsory education of all children in the age group of six to fourteen years as a Fundamental Right

 

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Source: Govt’s Bill on IIMs, and the concerns over their autonomy | ET