Well…first things first…an educational institution is not a money-making entrepreneurial venture, for it solely exists for the charitable purpose of imparting education. Which means that given its premise, it cannot be expected to generate profits by charging its students exorbitant fees. This of course means that most educational institutions in India, are thus short of funds and need charitable donations from the rich Indians, for the following reasons:
A Noble Cause: Nation-building
Well, let’s be honest, we are a fairly generous nation. I mean, forget giving to the living mortals, we even donate to the immortal Gods. Thus, we as a nation — especially the rich! — need to expand the gambit of our giving and include charitable giving in the name of nation-building. After all, educational institutions are temples too…albeit “temples” of learning.
Better Facilities and Faculties
Okay, this one is a no-brainer. Post globalisation, the country has witnessed a sharp hike in salaries in the corporate sector. This has had a direct bearing on the educational sector. For starters, less people are now showing a penchant for joining the educational sector, which is why even the big-wigs like the IITs and IIMs are facing an acute shortage of teaching faculty. In addition, the salaries of the teachers and professors have also seen a hike (thanks to the Sixth and the Seventh pay commission). Thus, in order to meet the increased salary hikes of faculty members, most schools/colleges have responded by hiking the school/college fees. Charitable giving would help take the load off the students, while making resources available for the colleges to invest in both facilities and faculties.
More Endowment Can Help Poor Students
Let us take a concrete example to explain how charitable funding of educational institutions can help provide more support for students from the weaker sections of the society. Do you know what is the endowment fund that Stanford receives from its generous benefactors? About 22 billion US dollars. And how does the endowment help the poorer students? Simple, their tuition is FREE!
Research Requires Money
See, research entails money…plain and simple! Which means for educational institutions to conduct more research requires more money. Unfortunately, the fact that educational institutions are not businesses means they do not have the wherewithal conduct scientific research. Which in fact is the reason why we have been steadily slipping in terms of our R&D. Hence, endowments would indeed go a long way in helping educational institutions conduct more research.
Sustainable Philanthropy
Well, for once, the focus of the world has shifted to sustainability (which is why we now have the SDGs or the Sustainable Development Goals). So, how can we make philanthropy sustainable? Well, the answer lies with economics, with a special reference to ‘the circular flow of money’. You see, when the rich give more money to schools and colleges, the school/college then can spend on better infrastructure, faculty and research, which in turn produces better educated pupils, who get better jobs and earn better pays, who can then in turn donate to these schools and colleges, and keep the circle last for eternity. [A case in point: the IITs!!!]
