Financial Crisis Hits Kerala Universities as State Misses Payment Installment

Kerala’s universities are grappling with a severe financial crisis after the state government failed to disburse a crucial payment installment. Several universities, including Kerala Agricultural University (KAU), have resorted to measures like mortgaging land to address mounting debts and continue offering courses.

The crisis initiated when the state government withheld the 12th installment of allocated funds, which was originally due in March. The government attributed this delay to the ongoing financial difficulties in the state. Initially, the government announced that the unpaid amount would be adjusted in the following year’s budget, sparking controversy. Subsequently, in August, a revised order was issued, seeking recommendations on recovering the outstanding arrears. However, despite the submission of these recommendations, no funds have been received, exacerbating the financial strain on these institutions.

KAU, for instance, faced a deficit of Rs 33.98 crore due to the non-receipt of this installment. Kerala Veterinary and Animal Sciences University (KVASU) was compelled to delay salary payments until September 11, highlighting the precarious financial situation faced by many universities. There is growing apprehension that further funding cuts may occur by the end of the financial year as the state’s finances continue to deteriorate.

Additionally, there is a risk that central funds provided to universities and aided colleges under the Pradhan Mantri Uchchatar Shiksha Abhiyan (PM-USHA) scheme may be suspended. Allocation of these funds is contingent on the implementation of the National Education Policy (NEP), an area where universities in Kerala have lagged behind. Concerns loom that due to their delayed NEP implementation, several universities in Kerala may be at risk of losing their eligibility for these funds and rankings.

This financial turmoil has raised significant uncertainties about the ability of these universities to sustain their operations and uphold academic standards.

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