Cross-Subsidization in Education

The Supreme Court has resolved a major dispute over medical college fees in Kerala. The state government had tried to create a central fund to help poor students by taking a portion of the higher fees paid by NRI students. The Court ruled this was illegal because there was no law to support it. However, it did not order a refund to the NRI students. Instead, the Court directed that the extra money collected should be returned to the individual private colleges. These colleges must now act as "trustees" of this money and use it to provide scholarships and subsidized education to the BPL students enrolled in their own institutions.