Given around 2 lakh Indian students go overseas each year, spending upwards of $8-10 billion on education, the decision to allow foreign universities to set up campuses in India was long overdue. Not only will this add to the number of university seats for students, the biggest improvement will be in the quality of the education available—while India has traditionally boasted of several high-quality universities, it has none in the top 200 in the world. Indeed, if you look at the Shanghai ranking of universities, the number of Indian universities in the top 500 are falling while those of countries like China are rising. This is especially problematic given that no country which has developed fast has done so without having top class universities.
While the government has allowed foreign universities to come into the country, whether they come is a different matter. Apart from the difficulties of getting land after the Land Acquisition, Rehabilitation and Resettlement Bill, the larger problem will be getting the requisite clearances. Keep in mind that a reputed Business School such as ISB preferred to go the non-recognised route as it found the existing system of approvals too bureaucratic.