This recent law would permit more substandard candidates to be inducted, and leave out more deserved candidates in the view of the public. Originally the quota allows for 22.5% seats reserved for those from Scheduled Castes (SCs) and Scheduled Tribes (STs). This has already been in effect for several years. The new law adds 27% reservation for a group labelled "Other Backward Castes" (OBC) who hail from the Middle-Class (Lower Income Group primarily, some from the Higher Income Group.) That results in about 49.5% of seats being reserved. The premier institutions within the global economy face stiff competition from private institutions with scaled-up infrastructure. A recent example is ISB who claim to have bettered the IIMs in quality and becoming the most sought after Business institute in the country. They were in the news for having one of their students secure the record highest entry-level salary originally held by an IIM. Companies even within India or abroad recruiting premier candidates do look for IIM graduates as they are considered to be cream. However with such a law people feel that they will start having to look elsewhere for good candidates.
The undercurrent however is that the Law has not been effected. So it's a big if. IIMs in recent time have been undergoing reform. Recently N.R.Narayanamurthy of Infosys fame who chairs the IIM-A committee has worked hard to hike up the fees from 150,000 INR p.a. to 175,000 INR p.a. There was a huge row about that too, although the strong answer from the Chairman was that this increase was necessary to improve faculty as stiff competition was on the rise. This increase is in effect. IITs face a dearth of growth in facilities. Many of the research programmes inside IIT campuses are sponsored by Alumni who are NRI entrepreneurs today.
What the Government has done, is a cheap manouver during election time to pull a law from dusty shelves passed long ago and not effected ever in an attempt to win volume votes from the "bottom of the pyramid." News channels airing this controversial move have not properly connected the political stratagem employed as an election ploy and delivered it to the people. The news media primarily the Television news channels, hoping to attract more viewership air only part of the news and opinions ignoring the more relevant issues that allay fears. This is a mixture of rotten politics and media stunts. It is an irony that candidates (the cream) applying to institutions now cannot see this. From what I see, this is a "STORM IN A TEACUP." The real storm is the degradation of primary and basic education that no one seems bothered about.