Experts believe the trend is due to the rising success of startup culture in India, which is led by several entrepreneurs that have graduated from IITs and IIMs. For students who might aspire to become businessmen, IITs and IIMs are prime for networking with the startup community. Venture capital investors also have a soft spot for these pedigree institutions.

The environment beyond academics, with an array of extracurriculars, clubs, and fests, is also a big draw. “The initiatives by IIMs more towards cultural activities and student-driven culture of IIMs is definitely a boosting factor to hold on to the students,” Harsh Jain, a chartered accountant who is a second-year student at IIM Shillong, told Quartz.

Can’t leave if you don’t come

The lower dropout rate may also have to do with more meaningful enrollments,  said independent human resources expert N Shivakumar.

There was a time when people were dropping out of IITs and IIMs to set up their own startups. Take Rahul Yadav of, for instance, who decided to drop out in his fourth year from IIT Bombay. Being a dropout actually made OYO’s Ritesh Agarwal eligible for Peter Thiel’s $100,000 scholarship, with which he started Oravel Stays—India’s answer to Airbnb—and today it’s evolved to become the multi-billion-dollar hotels group OYO.

Now, though, millennials and Gen Z, “have clarity of thought” and set up businesses even before starting college, Shivakumar said. Especially since plenty of resources like incubation centres and co-working spaces are available in the country.

“Maybe they look ad-hoc, but their maturity levels kick in a lot earlier,” he added. “They know what they need to do, and they know if the startups fail, they can always go back to education.”

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