The All India Management Association president R Gopalakrishnan on Monday called the Union human resources development ministry's directive to reduce the Indian Institute of Management fees to Rs 30,000 a year as a return to the regime of price control.
Founded in 1957, AIMA is the apex body of the management profession in the country.
"It is a retrogade step. The government is trying to impose price controls. We have seen what happened when there were price controls on industries such as vanaspati, sugar and cement. These industries were ravaged," Gopalakrishnan, also a Tata Sons director, told Business Standard, adding.
"The goals this time also are the same -- the government wants to satisfy the common man. But price control does not deliver the goods."
Gopalakrishnan added that the decision to reduce fees of only six IIMs of the country's 950-odd business schools was inequitous.
"Equity would require the government to extend the price control to all the 950 institutes. This is not practicable," he said, adding: "Fundamentally, we are not for bringing in price control. And certainly not in favour of an inequitous cut like this."
When asked if the government's decision to reduce the fees would in any way impact the quality of education at the IIMs, Gopalakrishnan said it could happen in the long term.
"Price controls in any sector over a long period of time will definitely impact quality. There are enough examples of this," he said, adding: "Price controls can be introduced only if there is a war or a calamity. But that does not seem to be the case right now."
Disagreeing with the claim that it was a social initiative on the part of the government to bring IIM business education within the common man's reach, Gopalakrishna said that IIM fees has never been an issue. "It is not clear what is the problem," he said.