Prof. (Dr.) Dharmakanta Kumbhakar
(drkdharmakanta1@gmail.com)
In the Union Budget 2026-27 presented by Finance Minister Nirmala Sitharaman, a much higher allocation has been made for the education sector compared to the previous fiscal year—Rs 1,39,289.48 crore—which amounts to 2.60% of the total budget estimates (Rs 53.5 lakh crore). This represents an 8.27% increase over the budget estimates of Rs 1,28,650 crore for the 2025-26 fiscal year. Rs 9,885.80 crore has been allocated to the Ministry of Skill Development and Entrepreneurship separately, which will also contribute to the education sector. The enhanced outlay in the education budget underscores the government’s commitment to support student development and institutional growth and hence education-led development of the country, in line with the vision of Viksit Bharat@2047.
Of the total education sector outlay for the 2026-27 fiscal year, Rs 55,727.22 crore (scheme allocation is Rs 10,142.40 crore and non-scheme allocation is Rs 45,584.82 crore) has been allocated to the Department of Higher Education. The allocations for the government’s major schemes in higher education are: Pradhan Mantri One Nation One Subscription (PM-ONOS)—Rs 2,200 crore, Pradhan Mantri Research Chair (PMRC)—Rs 200 crore, Centre of Excellence in Artificial Intelligence for Education—Rs 100 crore, Multidisciplinary Education and Research Improvement in Technical Education-EAP (MERITE)—Rs 300 crore, Pradhan Mantri Uchhatar Shiksha Abhiyan (PM-USHA)—Rs 1,850 crore, Pradhan Mantri Uchhatar Shiksha Protsahan Yojana (PM-USP)—Rs 1,560 crore, National Apprenticeships Training Scheme (NATS)—Rs 1,250 crore, Pradhan Mantri Research Fellowship (PMRF)—Rs 600 crore, and National Mission in Education through ICT—Rs 650 crore. The budget has allocated Rs 900 crore for world-class institutions and Rs 250 crore for the establishment of three Centres of Excellence (CoE) in Artificial Intelligence (AI) separately. The allocations for the autonomous bodies under Higher Education are Central Universities—Rs 17,440 crore, University Grant Commission (UGC)—Rs 3,709 crore, Indian Institutes of Technology (IITs)—Rs 12,123 crore, National Institutes of Technology (NITs)—Rs 6,260 crore, Indian Institutes of Management (IIMs)—Rs 292 crore, and Deemed Universities—Rs 650 crore. One hopes that these increased allocations in the higher education sector will help to provide quality education and skill development in higher education institutions.
Rs. 83,562.26 crore (scheme allocation is Rs 66,641.02 crore and non-scheme allocation is Rs 16,921.24 crore) has been allocated to the Department of School Education and Literacy in the budget. The allocations for the government’s flagship schemes Samagra Shiksha Abhiyan (SSA), Pradan Mantri Poshan Shakti Nirman (PM-POSHAN), and Pradhan Mantri School for Rising India (PM-SHRI) are Rs 4,100 crore, Rs 2,150 crore, and Rs 3,000 crore, respectively. Rs 3,200 crore has been allocated to the Atal Tinkering Labs (ATL). The Finance Minister launched the scheme in FY 2025-26 to set up fifty thousand ALTs in government schools over the next five years to cultivate the spirit of curiosity and innovation and foster a scientific temper among young minds. The allocations for the autonomous bodies of Kendriya Vidyalaya Sangathan (KVS) and Navodaya Vidyalaya Samiti (NVS) are Rs 10,129.41 crore and Rs 6,025 crore, respectively. One hopes that these increased allocations in the Department of School Education and Literacy will ensure quality primary and secondary education among the young students of the country.
India has already achieved one of the highest rates of female participation in Science, Technology, Engineering, and Mathematics (STEM) education globally. Prolonged hours of study and laboratory work in higher education STEM institutions pose some challenges for girl students. To enhance and encourage the enrollment of girls in higher education STEM institutions and courses providing secure and affordable accommodation, the Finance Minister has proposed in the budget to establish one girls’ hostel in every district of the country through Viability Gap Funding/capital support. The main outcome of this decision will be to increase the number of women attending higher STEM education, support students living in rural/semi-urban areas, and develop a safer and more inclusive academic environment for girls. This program highlights the importance of ensuring everyone, regardless of gender, has an equal chance and access to education.
The budget has proposed to support states in establishing five university townships in the vicinity of major industrial and logistic corridors. These planned academic zones will host multiple universities, colleges, research institutions, skill centres, and residential complexes. One hopes that the facilities will ensure students receive quality education, skill development, proper training, and employability through improved higher learning access.
As part of the education budget for 2026-27, the government has laid out its objectives for aligning education with employment and entrepreneurship so that all students would leave their institutions prepared to meet the expectations of today’s employers so that Indian youth can be global leaders in services, with a 10% global share by 2047. A high-powered ‘Education to Employment and Enterprise’ Standing Committee has been proposed in the budget to recommend measures focusing on the services sector, which is the core driver of Viksit Bharat. The Committee will prioritize areas to optimize the potential for growth, employment, and exports. The committee will assess the impact of emerging technologies, including Artificial Intelligence (AI), on job and skill requirements and propose specific measures for embedding AI in the education curriculum from school onwards and upgrading State Councils of Educational Research and Training (SCERT) institutes for teacher training. The committee will also identify cross-sectoral policy and regulatory issues, including standard-setting and accreditation, examine areas for services export, and propose steps to be taken to attract skilled diaspora and foreign talent into the country. The committee will be looking at measures for upskilling and reskilling technology professionals and engineers in AI and emerging technologies and will also propose measures for AI-enabled matching of workers, jobs, and training opportunities. The committee will propose measures to make the informal workflow visible, verifiable, and future-ready to enhance upward mobility prospects.
In her budget speech, the Finance Minister has announced provisions to set up ‘Content Creator Labs’ across 15,000 secondary schools and 500 colleges to promote pathways in the Animation, Visual Effects, Gaming, and Comics (AVGC) sector. These labs will be supported by the Indian Institute of Creative Technologies in Mumbai. The project aims to provide a platform to two million professionals by 2030 for growing the AVGC sector. It is seen that many students have different career aspirations. This initiative will encourage students to pursue their interests through creative subjects or applied disciplines such as media and communication, design and visual arts, content creation, and related areas. The initiative will support students in identifying new and emerging career paths within an academic framework who desire to develop their skills.
The Finance Minister has announced a plan to set up another National Institute of Design for the promotion of design education in eastern India. The Indian design industry is expanding rapidly, and yet there is a shortage of Indian designers. This new institute will definitely produce more designers in coming days. She also proposed to set up a National Institute of Hospitality by upgrading the existing National Council for Hotel Management and Catering Technology. This will function as a bridge between academia, industry, and government.
The budget proposes the reduction of Tax Collected at Source (TCS) from 5% to 2% for pursuing education abroad. This step would be a relief for students choosing to pursue higher studies outside the country.
The education budget for 2026-27 is a transformative budget, as there are bigger and bolder investments to strengthen education and future-ready skills. The budget reflects the government’s continued commitment to improving the quality of education, learning environments and infrastructure, learning resources, better facilities for learning and research, outcome-based and skill-based learning, and providing real-world learning opportunities in all parts of the country. However, there is a dire need to increase education budget allocation to meet the goal of the National Education Policy, 2020. Hopefully, this will be addressed in future budgets.