02/06/2016 10:51 AM IST | Updated 15/07/2016 8:27 AM IST

Govt Is Cracking Down On 5-Year MBA Courses. And That's Not Necessarily A Bad Thing

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ALLAHABAD, INDIA - 2015/02/14: Students jubilate after receiving degree and citations during 9th convocation of Uttar Pradesh Rajarshi Tondon open university. (Photo by Prabhat Kumar Verma/Pacific Press/LightRocket via Getty Images)

It’s been a rough year for many business school students in India: the job market isn’t quite impressed by them. Now, the country’s education regulator plans to unwind many five-year MBA programs.

According to a Mint report, the central government will close five-year integrated or dual-degree master of business administration (MBA) programs offered at certain universities and independent management schools. These programs typically award master’s degrees at the end of five years, and undergraduate degrees at the end of three or four years.

Education regulator, the All India Council for Technical Education (AICTE), has said such courses are "not in line" with the approved programs of the higher education regulator University Grants Commission (UGC).

Students enrolled in these courses will be permitted to graduate after three years, and no fresh enrollments will be allowed for the 2016-17 academic year. Degrees offered by the Indian Institute of Management (IIMs) won’t be affected.

Graduates from Indian business schools are increasingly falling out of favour with employers, with the exception of the graduates from the country’s top-tier business schools.

A recent study by industry association Assocham revealed that the vast majority of the 5,500 business school graduates in India are unemployable. With the exception of graduates from the Indian Institute of Management (IIMs), only about seven per cent of business school graduates had found jobs immediately after graduating.

Lack of quality control and infrastructure, low-paying jobs through campus placements, and under-trained faculty were the major reasons cited behind the “unfolding disaster” at Indian business schools, the study said. Combined with the economic slowdown, these factors led to a 45 per cent drop in campus placements, according to the study.

In the past two years, about 220 business schools have shut down across major cities such as Delhi-NCR, Mumbai, Kolkata, Bangalore, Ahmedabad, Lucknow, Hyderabad, Dehradun; another 120 schools are expected to close shop in 2016, the study said. The number of available business schools vacancies had nearly tripled in that period, according to the study. In 2015-16, there were about 5,20,000 individual openings for MBA courses, compared to 3,60,000 in 2011-12.

Given the somewhat dismal job prospects for many B-school graduates, the latest government move might be a step in the right direction.

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