The world economy has been facing a huge turmoil in the last few financial years. With constant efforts some improvement was observed in the last financial year as the world economic situation strengthened itself with a lingering effect to subside the effects of slump and registering world gross domestic product of 3.2 percent, the highest since 2011. The impact of world economic growth can be clearly seen on the GDP of India. The IMF sees India as the largest growing economy with a GDP of 7.4 percent even outshining the growth of China’s GDP at 6.8 percent. This growth has presented a challenge for the HR managers to focus more on strategic policy formulation and utilize the growth in the right direction. The line managers’ implement HR functions and in doing so they also influence their team and generate response from them. On the basis of extensive review a conceptual model has been proposed to understand the impact of interpersonal trust as a mediating variable on reallocation of HR functions and HR effectiveness. On evaluating the hypotheses values of CFI = 0.909, NFI = 0.745, GFI = 0.762, CMIN/DF = 1.396, RMSEA = 0.060, and PCLOSE = 0.066, which indicate a good model fit, the model shows the impact of the mediating variable, that is, interpersonal trust on reallocation of HR functions and HR effectiveness.

Higher education is all about people and management. The success of the higher educational institutions revolves largely around the quality of the research and the faculty. This emphasizes the need of a strong financial base to deliver a quality education to students. In the present scenario, which is characterized by intense information flow, dynamism, progress, growth, and continuous challenging environment, the higher educational institutions hold an important place. The present study focuses on exploring the relationship between human capital management and human resource development (HRD) climate. For the research purpose, two universities, University of Jammu and University of Kashmir, have been taken. The model derived by applying a confirmatory factor analysis in the present research study depicts a linkage between human capital management and HRD climate, and if applied in the institutions of higher education by customizing according to their needs and requirements, it would help in attaining the vision as perceived by Federation of Indian Chambers of Commerce and Industry for 2030 in attaining overall excellence in higher education sector in India. So, it is very important to develop research focused universities with community participation which could deliver high quality research output and research focused graduates and lead to creating a NALANDA for the new millennia.