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India's MBA Candidates Have an Entrance-Exam Problem

Indian students crowd outside a Common Admission Test (CAT) examination center in Bangalore

Photograph by Aijaz Rahi/AP Photo

Indian students crowd outside a Common Admission Test (CAT) examination center in Bangalore

Prospective MBAs in the U.S. may be sweating the GMAT, but at least it’s the standard for virtually all the management programs in the country. Applicants to business schools in India face a much more complicated slog, with roughly a dozen possible entrance exams depending on where they want to apply.

Recently, the Deccan Herald reported on a shift among graduate management programs in the Indian state of Karnataka. Schools there will begin to adopt the Post Graduate Common Entrance Test, or PGCET, as the main business school admissions examination. That follows a yearlong dalliance with the Common Management Admission Test, or CMAT. The body that makes these decisions for the state is the Karnataka Private Post Graduate Colleges’ Association (KPPGCA), a consortium of 169 schools. Got your abbreviations straight so far?

Going forward, a large number of slots at KPPGCA schools will be filled only by students who have taken the PGCET. Prospective students may also get mixed messages: An unnamed source tells the Herald that schools may in some cases use the Karnataka Management Aptitude Test (KMAT) or national entrance exams such as the Management Aptitude Test (MAT) and Common Admission Test (CAT).

What in the name of alphabet soup is going on?

For starters, there are a lot of business schools in India—perhaps 4,000, estimates Sriram Gopalakrishnan, director of marketing and communications at Indian School of Business (ISB), which operates campuses in Hyderabad and Mohali. That includes schools funded by the country’s central government, schools operated by state governments, and private colleges. “Many of the fly-by-night operators have shut shop because they’re not attracting applicants,” Gopalakrishnan says.

Still, there are enough schools to create demand for roughly a dozen noteworthy entrance exams in India, says Deepak Punwani, a Mumbai-based admissions consultant at the MBA Exchange. Most top MBA candidates applying to Indian schools usually start with the CAT, which is the primary admissions tool used by the ultra-selective Indian Institute of Management in Ahmedabad.

IIM-A, as it’s often called, accepted 0.25 percent of the 173,866 applicants for the 2012-2014 academic years. Other schools in the IIM system, including IIM-Bangalore and IIM-Calcutta, also use the CAT. So do other schools that draw applicants from across the country. Punwani says that regional schools, including those private colleges in Karnataka, prefer to give their own exams because it allows them greater control over things like test content, scoring methods, and whether the test is taken via computer or on paper.

Test-taking fees also produce income for the college associations. (It’s not bad for the test-prep companies, either.) ISB, which more closely resembles U.S. business schools than its Indian peers, asks students to submit GMAT scores. But for the $250 it costs to take the test, students could take the CAT about eight times, ISB’s Gopalakrishnan says.

Changing this system, however, would require upending exams that have a critical mass of students invested in them, says Matt Symonds, director of Fortuna Admissions and a contributor to Bloomberg Businessweek. “As I understand it, the number of test-takers for some of these Indian entrance exams dwarfs anything that GMAT and GRE can boast,” he says. “The trickiest part of the test is to know whether you are taking the right one!”

Clark is a reporter for Bloomberg Businessweek.

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