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UGC Recommends Diversified Revenue Streams for Higher Education Institutions

The University Grants Commission (UGC) has recommended that, in order to maintain financial sustainability, higher education institutions implement varied revenue streams, including as collaborations with the business sector, fundraising campaigns, gifts from alumni, and intellectual property (IP) commercialization.

The commission’s guideline for Institutional Development Plans (IDPs) for Higher Education Institutions (HEIs) suggests different income generation options.

On February 6, the commission distributed the instructions to all of its connected universities and institutions, recommending that they take the necessary measures to adopt them.

The recommendations require HEIs to identify and prioritize current and new funding sources.

The commission proposed a variety of financing strategies, including government grants, project overheads, research consultancies, patents, alumni gifts, private sector alliances, and fundraising campaigns.

“The public funded as well as other HEIs must strive to work on a sustainable revenue model where the revenues are derived from sources including tuition fee government grants and subsidies, overheads earned on the sponsored research and development projects from the government and private/ corporate sector, endowments, philanthropic contributions and other income like CSR, royalties on intellectual property (IP)/ patents, among others” the guidelines stated.

UGC chairperson M Jagadesh Kumar said that in addition to government funding, HEIs must focus on meeting their growing demands for academic excellence, research innovation, and infrastructure development through diversified revenue generation strategies.

Kumar said that by teaming with private sector industries, universities can access funding, research opportunities, and expertise that align with academic and industry needs.

Citing the example of Indian Institute of Technology, Madras (IIT-M), he said that the institute through its Incubation Cell has successfully fostered collaborations with industry partners, creating a symbiotic relationship where the industry benefits from cutting-edge research, and the university gains financial support.

“Beyond economic gains, these partnerships offer opportunities for collaborative research, industry-relevant curriculum development, and student internships. Such engagements enhance the practical relevance of education, making graduates more industry-ready,” he said.

Similarly, he said that fundraising campaigns and alumni donations constitute another potent source of revenue for universities.

Several IITs are already raising revenues from alumni donations and fundraising campaigns.

For instance, under IIT-Delhi endowment fund, ₹500 crore have already been pledged by over 400 alumni donors.

Similarly, in June last year, Infosys co-founder Nandan Nilekani had announced a donation of ₹315 crore to IIT-Bombay.

“These donations can be used for providing scholarships, research initiatives, infrastructure development, and more. Similarly, universities can leverage these campaigns to get support from philanthropic organizations, corporate entities, and individual donors who share a commitment to education and research,” the UGC chairperson said.

“The IDP guidelines of UGC are to encourage universities to embrace diversified revenue streams to ensure financial resilience and sustain their mission of academic excellence, leading to a holistic approach to university development,” he added.

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