New Delhi: Students who want to pursue management from the top Indian Institutes of Management (IIMs) will have to shell out more this year as three IIMs — Bangalore, Lucknow and Rohtak — have increased fee for their flagship MBA programme.
IIM Bangalore (IIM-B), which is among the top three B-schools in the country, will now charge Rs 23 lakh for its two-year MBA programme, up from Rs 21 lakh. This is at par with the fee at the other two of the top three institutes — IIM Ahmedabad and IIM Calcutta. These three institutes are known as the A-B-C of B-schools in India.
IIM-B had announced its intent to raise the fees for the 2020-22 batch in January this year.
IIM Lucknow increased its fees by a whopping Rs 5 lakh, raising it to nearly Rs 19 lakh for its flagship course. The institute is ranked at number four among the country’s B-schools, according to the Indian government’s National Institutional Ranking Framework (NIRF).
IIM Rohtak, which is among the newer IIMs, has increased its fees from Rs 13.8 lakh to Rs 15.2 lakh for the 2020-22 batch.
IIM Kozhikode, which is also among the top five B-schools, was also expected to make a similar move but hasn’t so far. The institute charges nearly Rs 19 lakh for its MBA programme.
Earlier, IIM-A was the most expensive B-school in India. IIM-C raised its fees last year from Rs 21 lakh to Rs 22.5 lakh. These B-schools have been ranking at the top in the NIRF every year since 2016, when the system was launched. Even before that, industry experts and academics considered these three the top institutes in the country.
‘Driven by average annual salary increases’
In emailed responses to ThePrint, IIM Bangalore and Lucknow said the decision to hike their fees had to be taken since it had remained unchanged in the last couple of years.
“The fee increase for the 2020-22 batch was decided in late 2019. The earlier fee increase was for the 2018-20 batch, when it was made Rs 21 lakhs. The fee for the incoming batch is Rs 23 lakhs, reflecting a near 10 per cent increase,” said IIM Bangalore director professor G. Raghuram.
“While we recognize that these are large amounts, IIM-B follows a philosophy that no student shall be denied education for want of funds. IIM-B provides scholarships and financial assistance to needy students,” he said.
Raghuram added that the decision is driven by average annual salary increases and other operating costs.
“The fee increase is primarily driven by the fact that average annual salary increases are 5 per cent (amounting to over 10 per cent in 2 years) and other operating cost increases are 8 per cent (amounting to over 16 per cent in two years). These costs are mostly fixed in nature,” he said.
“We also benchmark that our fees are in line with other institutions which our aspiring students consider,” he added.
IIM Lucknow also had a similar response.
“It is to be noted that IIM Lucknow had rolled back its fee in 2013 by 10 per cent from Rs 12 lakh to Rs 10.8 lakh. It is only for 2016 batch that the fee was brought back to 2013 levels (Rs 14 lakh). After 2016, there has been no fee hike and thus a decision to hike fee was taken in June 2019 in a board meeting,” said Vikas Srivastava, chairperson, corporate communications and media relations, IIM Lucknow.
“Even with this fee hike, IIM Lucknow has the lowest fee amongst the top four IIMs as per NIRF ranking,” he added.
ThePrint reached had also reached out to IIM Rohtak’s media division via email for a comment but there was no response until the time of publishing this report.
With the IIM Act coming into force in 2018, the IIMs became autonomous, which means they can make changes to the student fees without needing government approval. Most IIMs in India, including the latest — IIM Jammu, which came up in 2016 — charge above Rs 10 lakh for an MBA course.