Lukaku failed to break into Jose Mourinho's first-team plans at Stamford Bridge and moved to Everton in a £28 million deal in 2014.
The 22-year-old has established himself as one of England's most potent strikers at Goodison Park and Hiddink acknowledged that Chelsea's record of giving young players opportunities must improve.
"Lukaku is a very dangerous player," he told reporters. "It is difficult to judge how he performed when he was here and I don’t know the reason he was sold.
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“He has become a strong player and it is nice to see players develop. He’s one of the top strikers. Normally strikers who are not top in the league, they might get a little frustrated when they don’t score.
“But he is very cool and if he doesn’t score one game, then the next game he is taking the chances and that’s what makes him a good player.
“If you have this academy, the facilities and the training programme one day it must produce. If not it is not worth having an academy.
“If the management and board are having this policy you are unanimously in favour to do so. You must give young British players and those from abroad a chance."