There’s an MBA crisis brewing in India

After this year’s admission rounds, 80 per cent of seats in MBA and MCA colleges remained vacant in India’s thriving economic hub Gujarat according to the Times of India. 

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The degree has been struggling for a few years with the same newspaper reporting 65 per cent of MBA seats vacant in the Nagpur region in 2013 for example. Gujarat has some of the largest business corporations in India and its cities Ahmedabad, Surat, Vadodara, Rajkot, Jamnagar, Bhavnagar and Junagadh are major industrial centres in India.But in the case of business schools supply seems to outnumber demand in an unhealthy way. According to the Times of India 19,826 seats of the over 25,000 seats at MBA and MCA colleges remain vacant this year translating to 80 per cent of all places in these colleges. Worst hit by this syndrome are 84 colleges of the 237 self-financed colleges in Gujarat writes the paper as these schools had failed to get any student. According to the education department MBA colleges had felt this problem for a while but this year it also hit MCA colleges which offer the Master of Computer Applications.


India has the largest MBA market in the world, but teaching standards are not always up to scratch. India’s daily financial paper Business Standard named this earlier this year as a reason for the decline with many Indian business schools - including the leading ones – faltering on even the basic parameters of faculty, research, accreditation and students mix.

Whereas in China ten schools have been accredited by AACSB, only three Indian business schools have been awarded this accreditation. These are the Indian Institute of Management Calcutta, the Indian School of Business in Andhra Pradesh and the T. A. Pai Management Institute in Karnataka. Similarly, only a few have the other two key global accreditations - the European Quality Improvement System (EQUIS), or the Association of MBAs (AMBA). The Indian Institute of Management Ahmedabad and the Indian Institute of Management Bangalore being two examples of accredited schools.

The overall lack of accreditation and therefore trustworthiness led Business Standard to call for India’s own accreditation body for business schools earlier this year. To improve the market which is slipping more and more into a crisis, the paper also suggested to establish three tiers of management institutions. Within these tiers the best 25 to 30 B-schools could be asked to focus solely on pedagogy, generating international quality research, accreditation, ranking, global faculty and students exchange. The mid-tier schools could focus on teaching to produce managers that industry needs and the third tier could look at integrating skills education with management programmes, according to the paper.  After the recent, rather devastating numbers it might be time to look into these suggestions urgently.


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Barbara Barkhausen