Government today approved a proposal for investment of Rs 2,430 crore in nearly 200 engineering colleges under a scheme aimed at upgrading the standards of technical education institutions in the country.

The Cabinet Committee on Economic Affairs, chaired by Prime Minister Manmohan Singh, gave the go ahead to the second phase of Technical Education Quality Improvement Programme (TEQIP) scheme which has been running since 2003 with World Bank's assistance.

The second phase envisages an investment of Rs 2,430 crore in about 200 technical educational institutions with an aim to produce higher quality and more employable engineers, Home Minister P Chidambaram told reporters here.

The project has covered 127 institutions in 13 states in the first phase.

"The first phase has been rated as satisfactory by the World Bank," Chidambaram said.

The major objectives of the scheme are strengthening of institutions with improved learning outcomes and employability of graduates, scaled-up post graduate education and demand-driven research and development and innovation, establishment of centres of excellence and imparting of pedagogical training to the faculty.

The project will be open for competition and participation by all engineering institutions approved by All India Council for Technical Education.

An estimated 200 engineering institutions including the Centrally Funded Institutions like National Institute of Technology will be competitively selected along with a small number of eligible private unaided institutions.

The TEQIP scheme was started to upgrade the quality of NITs and state-level engineering institutions which were lagging behind in research and training.

The scheme was envisaged as a long-term programme of about 10-12 years duration to be implemented in three phases for transformation of the technical education system with World Bank assistance. The first phase ended on March 31 last year.

Out of total project expenditure of Rs 2430 crore in the second phase, the World Bank will contribute Rs 1395.50 crore, the Centre's contribution as per 11th Five Year Plan is Rs 500 crore while the states and private unaided institutions will invest Rs 518.50 crore and Rs 16 crore respectively.