New Delhi, Jan. 24: The Union cabinet today cleared a bill to grant statutory powers and autonomy to 20 Indian Institutes of Management.

If the bill is passed, the IIMs will be the first set of institutions under the administrative coordination of the human resource development ministry in which the President will have no direct role. In other institutions like the IITs and central universities, the President is the Visitor who appoints directors, vice-chancellors and chairpersons on the recommendation of the ministry.

The human resource development minister will have no role in the affairs of the IIMs. At present, the ministry appoints the IIM board chairperson and director. After the bill is passed, the situation in the IIMs will be different from that at the IITs whose council is headed by the minister. In the case of central universities, the minister calls meetings of vice-chancellors.

Prime Minister Narendra Modi tweeted: "The IIM bill, which was approved by the cabinet, has been prepared with the aim of furthering excellence in these premier institutions."

Each IIM's board of governors will have a chairperson, director, four eminent persons from industry, social service and academia, five representatives from alumni and the IIM Society, two representatives of faculty and one representative each from the Centre and the state government where it is located.

Among the total 15 members, there should be at least three women, including one SC/ST. The chairperson of the board can invite any expert to attend its meetings. But the experts will not have voting rights.

The IIMs, set up in the 1960s to meet the shortage of managerial resources, have been functioning as registered societies. Since they are not set up by any act of Parliament, they offer diploma courses. The IIMs' post-graduate diploma in management (PGDM) is considered equivalent to MBA and its Fellow Programme in Management is the doctoral programme.

Although the IIMs enjoy high credibility, some institutions raise questions about the nomenclature of the PGDM certificates. "There are instances of students submitting an undertaking that the PGDM certificate is equivalent to the MBA. World over, the MBA is an accepted degree," an IIM director said.

After the bill is passed, the IIMs can issue MBA degrees and PhD certificates.

Autonomy for the IIMs has been a touchy topic. Sources said a veteran BJP leader had "informally" conveyed his concerns to HRD minister Prakash Javadekar on the autonomy proposed for the IIMs vis-à-vis other institutions.

The minister was not present when the cabinet approved the bill because he was in Pune for his son's wedding.

The bill is understood to be silent on implementing reservations in faculty recruitment. The IIMs had earlier cited a 1975 government order giving them exemption. But in 2013, the HRD ministry requested the IIMs to implement the quota, which they are yet to do.

The bill is likely to be introduced in the budget session.

The bill also says that the IIMs would be declared as Institutions of National Importance, a tag enjoyed by select institutions like the IITs, NITs and AIIMS.