The Union Budget 2025 presented on February 1 increased allocations for the education sector only marginally and is unlikely to realise the ambitious goals set out in the New Education Policy, 2020. The allocation of Rs 1.28 lakh crore out of a total outlay of Rs 50.65 lakh crore is 6.65% higher than the previous year. But it is merely 2.54% total budget (0.4% of the gross domestic product, as per current estimates).
The New Education Policy seeks to fundamentally restructure India’s education system. Yet, as per the Ministry of Education’s budget estimates, public spending on education (by both state and Centre) has been stagnant at 4.2%-4.6% of the gross domestic product since 2019.
The Reserve Bank of India estimates that spending on education is even lower, at 2.7% of GDP. This is well below the benchmark of 6% recommended decades ago by the Kothari Commission on Education in 1966.
The mid-day meal programme, crucial for retaining children and ensuring regular attendance in elementary schools, has also not been given funds to adequately compensate for inflation and rising costs.
In this article, the budget estimates for 2024-’25 have been compared with the allocations proposed in the budget for 2025-’26.
Education funding
Among ministries, the education ranks 10th with allocations lower than the funds for road, transport and highways (5.7%), chemicals and fertilisers (3.2%) and agriculture and farmers welfare (2.7%).
Within the Ministry of Education, the Department of School Education and Literacy got Rs 78,572 crore (1.5% of the budget) and Higher Education got Rs 50,078 crore (0.99% of the budget). The total increase is Rs 8,022 crore, up 6.6% from the budget estimates presented in July 2024.
The allocation for Samagra Shiksha, the Centre’s support for elementary and secondary school education, marginally increased from Rs 37,010 cr to Rs 41,250 crore. Samagra Shiksha is the result of the merger of three schemes: Sarva Shiksha Abhiyan for universal elementary education, Rashtriya Madhyamik Shiksha Abhiyan for secondary and higher secondary schools and Teacher Training Education such as the District Institutes of Education and Training.
A major share of Samagra Shiksha’s allocation, Rs 35,000 crore, goes towards primary education. The remaining meagre amount of Rs 6,250 crore is for secondary education. As a result, the Centre’s cumulative support for all its secondary schools in India is less than half the funding for central schools such as Kendriya Vidyalayas (Rs 9,504 crore) and Navodaya Vidyalas (Rs 5,305 crore).
The New Education Policy aims to achieve universal access to education from preschool to the secondary level by 2030. The policy draft in 2019 had flagged high dropout rates due to limited access to secondary schools and suggested building school complexes to address the issue.
The final policy had also mentioned that bringing children back into the education system at the secondary school-level is a priority. According to the Unified District Information System for Education dashboard, the overall dropout rate at the secondary school-level is 10.9%.
But budgets have not addressed this concern.
The Pradhan Mantri Schools for Rising India or PM-SHRI, the only component directly in line with the New Education Policy, was allocated Rs 7,500 crore to upgrade 14,500 schools that will serve as exemplary institutes in terms of the policy objectives. But this means that old schools will be upgraded as per the New Education Policy. Without adequate funds to build government secondary schools or integrated schools complexes, the dropout rate is likely to remain high.
PM-POSHAN, as the National Mid Day Meal Programme is now called, was allocated Rs 12,500 crore, a 0.26% increase from Rs 12,467 crore for 2024. Adjusting for inflation, this is a reduction from last year. Some progressive states, such as Tamil Nadu, have implemented breakfast schemes to promote regular school attendance and improve children’s nutrition. However, the Centre’s reluctance to expand the mid-day meal programme is concerning and its expenditure per child remains low, limiting the effectiveness of the scheme.
The other major budget announcement was providing broadband connectivity to all government secondary schools under BharatNet, which was initially to give gram panchayats internet connectivity.
Other aspects of the New Education Policy, such as the integration of vocational education in schools, require substantial investment in infrastructure and teaching, but there has been no special allocation towards these goals. Instead under Samagra Shiksha, states and Union territories have been given a non-recurring grant to purchase tools and equipment, including furniture and computers, to augment school infrastructure and accommodate vocational education.
The budget has also provided for the capacity-building of teachers and skill trainers, the development of a competency-based curriculum and teaching learning material, and the development of a management information system.
In her budget speech, Finance Minister Niramala Sitharaman announced a Rs 500 crore initiative to set up centres of excellence in artificial intelligence, increase seats in the new Indian Institutes of Technology, and add 10,000 medical seats at the undergraduate and postgraduate levels.
The allocation for higher education has been increased from Rs 47,620 crore (2024-’25 Budget Estimates) to Rs 50,078 crore. A bulk of the amount, about 69.1%, goes towards supporting central universities (Rs 16,690 crore; 34.2%), the Indian Institutes of Technology (Rs 11,349 crore; 23.3%) and the National Institutes of Technology (Rs 5,688 crore, 11.7%).
In comparison, PM-USHA, the centrally-sponsored scheme for state and Union territory Institutions, and the central scholarship scheme PM-USP, were together given just Rs 3,360 crore. Given that India has 445 state universities and approximately 9,200 state government colleges, this level of support is inadequate and widens the resource disparity between central and state institutions.
The Economic Survey, 2024-’25 has a separate section on the importance of “Social and Emotional Learning” among children, which the New Education Policy emphasises. But there is no roadmap on how the Centre can fiscally support social and emotional learning programmes.
Education optimism
There is some optimism after the Annual Status of Education Report 2024 on the learning levels of children and elementary education in rural areas was released on January 30. But the improvements mentioned in the report address a fraction of the New Education Policy’s broader vision to promote critical thinking, digital literacy, multilingual education, vocational training and assessment reforms.
The report, for instance, recorded the greatest improvement in basic reading and arithmetic in 20 years. Class 3 reading levels in government schools improved from 16.3% in 2022 to 23.4% in 2024, while numerical subtraction proficiency rose from 25.9% to 33.7% in the same period. However, the gains are largely attributed to NIPUN Bharat, which is focused on foundational literacy and numeracy. The report also showed major improvements in pre-primary school enrollments in rural India – up from 68.1% in 2018 to 77.4% in 2024.
The Union Budget 2025 has incremental increases in education spending but it falls short of the investments needed for a transformative implementation of the New Education Policy. Despite marginal increases in allocation for school and higher education, key structural reforms – such as secondary education expansion, vocational integration and multidisciplinary higher education – are underfunded. Without a major boost in public investment, the New Education Policy risks being implemented in a fragmented, piecemeal manner, leaving its most ambitious goals unrealised.
Shivakumar Jolad works as an associate professor of public policy and a member of the FLAME Centre for Legislative Education and Research.
Umesh Bedkute is a freelance political consultant.
