New Delhi, Feb. 4: Kapil Sibal today deferred a decision on an IIT proposal for an eight-fold fee hike till a proposed funding agency to facilitate higher education loans to poor students comes up.

The IITs proposed a fee hike from Rs 50,000 to Rs 4 lakh a year at a meeting today with the human resource development minister to discuss a reform roadmap for India’s premier engineering schools. But the decision was deferred by Sibal, government sources said.

The government plans to set up a higher education finance corporation along the lines of the National Bank for Agriculture and Rural Development (Nabard) to offer loans to fledgling institutions and students under special terms and conditions.

The proposed corporation aims to offer loans under conditions more attractive than those offered by regular banks and financial organisations. The government will decide on the fee hike after the corporation is set up, Sibal said after a meeting with IIT directors.

The proposal, drafted by IIT Kanpur, has suggested the finance corporation or other funding mechanisms can be used to help poor students get education loans.