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27.05.2 0 1 5

PMK Youth Wing President Dr. Anbumani Ramadoss Statement

STUDENTS SHOULD BE GIVEN

EDUCATION LOANS UNCONDITIONALLY
The results of the twelfth standard examinations are announced and students are getting admitted to
arts and science colleges. The admissions to medical and engineering colleges also will commence
shortly. While college education is assured for the rich students the poor are struggling to access
higher education due to financial difficulties.
To ensure that money is not a constraint to get higher education, education loans were introduced in
the year 2000-01. While education itself is at hands reach for the poor students, the loans for paying
their education remains at horizon. Education loans evade them even after knocking the doors of
several financial institutions. The reason for this are the unpractical rules laid down by the public
sector banks.
The bankers associations had laid down even more stringent rules in the year 2015-16 for availing
education loans. In the meeting convened by interdepartmental officials to discuss distribution of
education loans, officers of the Human Resources Development Ministry submitted a list of 1100
educational institutions graded A. It is said that those who study in these A grade institutions are
certain to get jobs and hence it is suffice to give loans only to them. It has also come to our knowledge
that banks were instructed not to lend to students admitted under management quota in private
institutions.
The reason banks scramble to give loans to students entering A grade institutions is that they are
guaranteed to get jobs. It is also stated that the students entering private educational institutions
under management quota are richer and hence need not be given loans. These are baseless
assumptions. This is not a race to bet on the winning horse but the life of poor students. The best
chance for a poor student with marginal marks to get an education with job opportunities is to get a
management seat in a private institution. Just because they enter private educational institutions by
paying higher fees they should not be considered rich. Banking officials should understand that many
of the parents of these poor students sell their homes and livelihood earning assets to pay the capitation
fees and approach the banks to pay the fees.

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The reserve bank statistics show that Rs. 61,176 crores worth education loans were distributed so far
in India and Tamil Nadu stands first by availing Rs. 16,380 crores of education loans. The total number
availed loans is 9,56,100. It may surprise us. But it is very meagre. There are 517 engineering colleges
and 1150 arts colleges in Tamil Nadu. Every year 8 lakh students enter various degree courses. Hence
1.20 crore students have joined college since the introduction of education loan. Of this only 9.56 lakh
students, i.e. 7.96% had been given loans by public sector banks. This is less than adequate. In spite
of repeated directions of the Madras High court to distribute education loans without restrictions the
bank managements remains resilient. This is highly condemnable.
Students are the valuable assets of our country. The loans given for their education is investment for
the development of the nation. Impractical restrictions cannot be laid for this. The amount of NPA
loans to public sector banks is Rs. 2,60,531 crores until December 2014. Majority of these were given
to corporates. Even then banks lend crores of money freely to these corporates with bad repayment
history. It is unfair to deny few lakh rupees of loan to the poor students.
Hence public sector banks should give education loans to every student applying for loan.
Yours,

Dr. Anbumani Ramadoss