India has world’s third largest higher educational system, next to China and United States. The mission of higher education is to achieve access, equality, justice, quality, employability, inclusiveness and create a knowledge society/economy. The deteriorating administration, unproductive practice, corruption and fund unavailability leads to break down of indigenous educational system. To tackle with the problem of unavailability of funds, instead of setting up new institutions, which require huge investments, priority of the government is to expand the capacity of existing institutions and to open the new educational institutions in higher education in private sector only. There are three forms of privatization of higher education institutes- Government self financing institutes, Government aided private self financing institutes and completely private higher education institutes. The need to privatize higher education is explained in this paper. The impact of privatization in higher education is positive as well as negative. The suggestions to take maximum benefits from privatization are also discussed.
