The Indian higher education system has a special feature - participation of self financing private institutions in higher education with a tag of `affiliation' to the universities. Every State university has the power to grant affiliation to the private colleges and impart education to them within the framework of academic and administrative directions laid down by the universities. In the present scenario, after examining the experiences of quality education imparted by the deemed universities and institutes of excellence, encouraging private players in education is one of the best options and alternatives available to the government. India has inherited the excellent cultural heritage and knowledge base for years. The history has the record of students coming from different countries to pursue higher education in India.

Because of various socioeconomic changes that took place during last few centuries and other constraints such as excessive population, poverty, lack of adequate infrastructure facilities, India is facing the problem of outflow of the students. There is a flocking of students for immigration to the developed countries like USA, Australia, UK and other European countries and New Zealand with a plea of quality education and placement opportunities. On the other hand, taking advantage of the situation, the foreign universities are establishing their marketing offices and posting their representatives to facilitate the enrolment of students in their institutions and universities. They conduct road shows, seminars, workshops and other activities to attract the students and export them to their native countries. Some of the universities from developed countries and Singapore are approaching the government to permit them to establish their campuses in India. Thus, the Indian higher education scenario is foreignized by exporting the educational services to India and enrolling the Indian students in the foreign universities. It poses a challenge to the Indian higher education, particularly in the light of the new dimensions attributed to the education under the provisions of the General Agreement on Trade in Services (GATS). The GATS permits the trade in educational services.