Attracting foreign colleges to open campuses in India is one solution for a university system that India's planning commission says is "plagued by a shortage of well trained faculty, poor infrastructure and outdated and irrelevant curricula."
Despite a surplus of workers, employers across sectors say local universities do a poor job of preparing graduates for working life. None of India's universities feature in the world's top 200, the 2013/14 rankings by the London-based education group Quacquarelli Symonds show, versus seven from China.
Many homegrown universities rely on rote-learning and fail to teach the "soft skills" that are increasingly important in India, where the services sector has driven the economic growth of the last two decades, recruiters and students say.
"We don't learn here - we are just taught to mug up, so it's hard for us when we go out to find jobs," said Singh, an undergraduate at one of the country's largest private colleges, Amity University, referring to the teaching style across India.
"I'm worried that when I get to my first internship, I won't know how to do anything."
Foreign universities have been largely shut out of India, allowed only to open research centres, teach non-academic courses or offer degree courses with a local partner.
Now, the government wants to offer them the more lucrative option of opening their own campuses.
India's ministry of human resources and development is trying to issue what is in effect an executive order, which would leapfrog a bill stuck in parliament since 2010, one casualty of a legislative logjam that has paralysed Indian policymaking over the last two years.
Despite scepticism from many institutions that India will be able to change its game with elections looming by next May, some foreign universities are keen to push ahead with campuses.
"A campus in India has always been our vision and that is our plan," said Guru Ghosh, the vice-president for outreach and international affairs at Virginia Polytechnic Institute and State University, known as Virginia Tech.
It is due to launch a research centre near the southern Indian city of Chennai in spring 2014 and hopes to set up a campus within 3-5 years