The Union Cabinet approved a proposal by the Ministry of Human Resource Development (MHRD) for expanding the scope of its Higher Education Financing Agency (HEFA) by enhancing its capital base to Rs 10,000 crore to meet the rising financial requirements of educational infrastructure in the country.
The HEFA has been tasked to mobilise Rs 1 lakh crore for Revitalizing Infrastructure and Systems in Education (RISE) by 2022.
In order to expand this facility to all institutions, especially those set up after 2014, the central universities which have very little internal resources, and institutions like AIIMS and Kendriya Vidyalayas, the Cabinet Committee on Economic Affairs (CCEA) has approved five conditions for financing under the HEFA and the modalities of repaying the principal portion of the fund.
"Technical institutions which are more than 10-years-old will have to repay the whole principal portion from the internally-generated budgetary resources; institutions which started between 2008 and 2014 will repay 25 per cent of the principal portion from internal resources, and receive grant for the balance of the principal portion. Central universities, which started prior to 2014, will have to repay 10 per cent of the principal portion from internal resources, and receive grant for the balance of the principal portion. Newly-established institutions will be provided grants for construction of permanent campuses," an official statement said.
Other educational institutions and grant-in-aid institutions of the Ministry of Health, including the newly-set up All India Institutes of Medical Sciences, and other health institutions, the Kendriya Vidyalayas and Navodaya Vidyalayas would be funded and the department or ministry concerned will give a commitment for complete servicing of the principal and interest by ensuring adequate grants to the institution.
The CCEA has also approved that the modalities for raising money from the market through government guaranteed bonds and commercial borrowing would be decided in consultation with the Department of Economic Affairs so that the funds are mobilised at the least cost.