Dr Murli Manohar Joshi is a quiet man these days.

Not too long ago, Dr Joshi had brewed yet another storm in a tea cup by slashing the fees of the prestigious Indian Institute of Management. If memory serves me right, the fees dropped from Rs 150,000 per annum to Rs 30,000.

The minister had defended the fee cut at that time saying it would make higher education more accessible and break the stranglehold of the English-speaking, city-bred elite. The detractors said it would dilute the quality of the IIMs, making them no different from the countless education shops.

India is the second fastest growing economy in the world today. At a most basic understanding, an economy grows when goods -- agricultural and industrial -- are produced and bought and/or when the service industries are growing phenomenally. In India's case both sectors are performing very well.

For an economy to function to its optimum capacity, a trained workforce is essential. More so in India's case where the services sector has become a force to reckon with. A turbo-charged BPO, IT and ITES sector requires people who are English-speaking and have reasonable to good coding skills.

While a rapid explosion of such industries, requiring specific skill sets, have generated employment, it has led to a situation where education shops have cropped up imparting skills without imparting knowledge. It is akin to an automobile company importing Completely Knocked Down (CKD) kits and assembling them here. The workers of the automobile company know how to screw the nuts and bolts, but have no knowledge about the technology that goes into making a world-class car.

Revitalising Technical Education says that two decades ago, there were less than 300 engineering institutions in India. Now, there are more than 1,200. Similarly MBA institutes have mushroomed to about 900, with an intake of about 60,000 students. The alarming part about the mushrooming of engineering institutes is that almost 970 of them are self-financing institutions and are not even accredited to the AICTE!

The AICTE has a regulation that a teacher-student ratio must be 1:15. Moreover, it adds that the ratio of professors to associate professors to lecturers should be 1:2:4. Not surprisingly, majority of the 1,200 engineering institutes do not follow these ratios.

So while there are a handful of IITs and IIMs producing entrepreneurs, original thinkers and job creators, there are countless other institutions ostensibly offering similar education, but churning out conveyer belt coders. As an aside, off the cuff how many schemes can you think of that have been designed to help entrepreneurs. I, for one, can't recall any. Germany [Images], in contrast, has 6,000 technology business incubators. China -- we always get riled when compared with our Asian neighbour -- has 4,000 such incubators.

Given these facts, then there is question that needs to be answered? Is China actually benefiting from missing the BPO bus? And does India need to rethink its involvement with low-end BPO operations, especially the back-office variety?

In an interview, U R Rao admitted that if norms were to be implemented strictly the faculty requirement would be in the range of 30,000 professors just for the engineering institutions. Compare the requirement with this shocker of a figure. India produces only 375 PhDs a year across all disciplines!

Anyone who has visited one of those private computer institutes will surely know how the gap in faculty requirement is filled. While one can proudly say that India produces 350,000 engineers every year, can one be proud of the quality of each one of them? I am not so sure.

So what is the solution? The solution is twofold. One part of the solution has already been put forward in the report and one doesn't need rocket science to figure it out. It involves implementing regulations thoroughly, getting institutions to take accreditations seriously, tightening the accreditation procedure, tightening recruitment procedure of faculty members, reducing the intake of students, discouraging self-financing institutions, doing away with the concept of deemed university, increasing spending on higher education and research and increasing interaction between the academic world and the industry.

The second part of the solution is slightly more complex and has not been suggested in the report. Let us face it. The BPO, IT and ITES industries are here to stay. Since these industries are providing employment, it is logical for several institutions to train people in specific skill sets required for those industries.

But the challenge is to keep the Indian knowledge pool competitive. Our higher educational system, which has been good, has till now managed to produce high-quality engineers, biotechnologists and social scientists, who have come up with original work and research. The rapid growth of 'just skills' education is eroding our knowledge base.

The key to maintaining and enhancing our knowledge base is to -- borrowing a tech terminology -- declare certain institutions as 'cutting edge institutions'. These institutions should be spread across disciplines, unlike the current emphasis on applied science.

To explain this concept clearly, let us take the example of Jawaharlal Nehru University, considered the country's premier institution for research in social sciences. For long, JNU was the fount of knowledge creation in social sciences. The academics, research scholars and students could hold their own in the world stage. In short, they were part of the global knowledge creation process.

The twin impact of globalisation -- retreat of the state on one hand and creation of new and highly paying jobs on the other -- meant that funds to JNU dried up, while students who joined ostensibly to do research flew off to greener pastures. According to one former JNU proctor, the conversion rate of students doing masters to higher degree fell by over 40 per cent in period 1990 to 2000.

What such a decline has led to is the diminishing Indian presence in the global knowledge creation process. What an editor in a prominent publishing house told this columnist will reveal the extent of this reduction. In the last decade the number of Indian authors publishing social sciences books have dropped by over 20 per cent, while the number of proposals for publishing social sciences guidebooks have increased by 35 per cent.

What is even more alarming than the decline in the number of original Indian authors is the fact that the majority of those Indian authors who publish original work are not even based in India!

What is true of JNU, is also to a large extent true of the IITs and IIMs. The Indian government should evolve a policy on declaring certain institutions 'cutting edge'. Such a branding, quite obviously, will come with financial rewards in terms of greater funding, exchange programmes of scholars, quality research products, tie-ups with foreign institutions and better infrastructure.

The entry into such institutions, whether of research faculty or students, should involve the crossing of multiple barriers and only the very best should get into it. Very best, of course, means the absence of quotas of any kind and a whetting process that weeds out those not interested in conducting research. Like the Armed Forces Medical College, people entering the 'cutting edge institution' may be asked to sign a bond. Entry into a 'cutting edge institution' should also mean a guarantee of tenure. For instance, a research student should have the path to move up the ladder and get international exposure.

It is evident that the government alone can't generate enough money to propel these 'cutting edge institutions' forward. This is where a far-sighted corporate sector can contribute. The Indian corporate sector has shown signs of maturity. By being equal partners in knowledge creation, they can show the rest of the world that they have finally come of age.

Such an approach is essential if India is to maintain the knowledge base that it has painfully created over the last five decades. This approach will also allow India to once again begin contributing in a systematic way to the global knowledge creation process and eventually establish its hegemony.

If such an approach is adopted, by 2050 India will be a Knowledge Superpower. Let us not become the back office of the world and revel in epitaphs like Information Superpower.

French philosopher Michel Foucault said it in a different context. But what he said still holds true. Knowledge is power.