The Union Cabinet on Tuesday approved the Indian Institutes of Management Bill, 2017, declaring them as 'Institutions of National Importance and granting the premier institutions complete autonomy.
The Cabinet, chaired by Prime Minister Narendra Modi, approved the bill, under which the IIMs would be provided with statutory powers and will be awarding degrees instead of diplomas.
Being autonomous bodies registered under the Societies Act, the IIMs so far were not authorised to award degrees and have been awarding Post - Graduate Diploma and Fellow Programme in Management.
While these awards are treated as equivalent to MBAs and Ph. D, respectively, the equivalence is not universally accepted, especially for the Fellow Programme.
The All India Council for Technical Education (AICTE) defines an Institute of National Importance, as one which serves as a pivotal player in developing highly skilled personnel within the specified region of the country/state.
The Ministry of Human Resource Development currently recognises 74 institutions as 'Institute of National Importance'.
The Bill also provides for adequate accountability by the IIMs.
The annual report of the institutions would be placed in Parliament and the Comptroller and Auditor General (CAG) would audit their accounts.
The management of these institutions would now be board - driven.
A greater participation of experts and alumni in the 'board' is amongst other important features of the bill.
Provision has also been made for inclusion of women and members from Scheduled Castes/Scheduled Tribes in the board.
The bill also provides for periodic review of the performance of institutions by independent agencies, and placing the results of the same in public domain.
"The IIM Bill focuses on complete autonomy, effective administration, more alumni participation and many other areas, " said Prime Minister Narendra Modi on twitter.
Union HRD Minister Prakash Javadekar termed the move historic.
"Historic decision to give IIMs real autonomy and grant degrees.
We trust excellence and quality.
This reflects vision of Modi government for higher education, " said Javadekar.
Welcoming the move IIM Kolkata Director Saibal Chattopadhyay hoped the bill was passed by Parliament at the earliest.
"It is great news, we have been waiting for this.
I sincerely hope the remaining formalities are completed and the bill is passed in Parliament soon, " Chattopadhyay told IANS.
"It will be great if the new law is passed before March so that the students passing out this year get degrees and not diplomas, " he added.