Union Budget 2025: Nirmala Sitharaman Allocates ₹1.28 Lakh Crore for Education; IITs See Surge, IIMs Face 50% Cut
In the Budget 2025-26, major shift in funding patterns as IITs and NITs receive ₹1,370 crore boost, while IIMs face a historic 50% budget cut; school education sees digital and infrastructure push. Check Sector wise Analysis here...
Union Finance Minister Nirmala Sitharaman, in her eighth budget presentation, allocated ₹1.28 lakh crore for the education sector in Union Budget 2025, reflecting a significant policy shift. The total allocation for school education increased from ₹73,008 crore in 2024-25 to ₹78,572.10 crore in 2025-26, marking a rise of ₹5,564.10 crore, while higher education saw a modest increase from ₹47,619 crore to ₹50,077.95 crore, an uptick of ₹2,458.95 crore.
Technical education emerged as a clear priority, with IITs and NITs receiving an additional ₹1,370 crore, while IIMs saw a drastic 50% funding cut. IISERs and Central Universities also faced reductions, impacting research in pure sciences. Meanwhile, school education witnessed a digital transformation push, with 50,000 new Atal Tinkering Labs and broadband expansion for secondary schools.
The 2025-26 budget signals a strategic shift towards technical education, increasing allocations for premier engineering institutions while reducing funds for management and pure science institutions.
Key Institutional Allocations:
The budget introduces a distinct shift in higher education priorities, with Indian Institutes of Technology (IITs) and National Institutes of Technology (NITs) emerging as major beneficiaries.
Institutional Impact Breakdown:
| Category |
2024-25 Budget (Cr) |
2025-26 Budget (Cr) |
Change (Cr) |
Change (%) |
|---|---|---|---|---|
| IITs |
9,661 |
10,384 |
+723 |
+7.48% |
| NITs |
4,500 |
5,147.47 |
+647.47 |
+14.39% |
| IISERs |
1,000 |
813.33 |
-186.67 |
-18.67% |
| Central Universities |
12,000 |
11,500 |
-500 |
-4.17% |
| Deemed Universities |
5,000 |
4,800 |
-200 |
-4% |
| IIMs |
608 |
300 |
-308 |
-50.66% |
Budget Allocation in School and Higher Education
| Category |
2024-25 Budget (Cr) |
2025-26 Budget (Cr) |
Change (Cr) |
|---|---|---|---|
| Department of School Education |
73,008 |
78,572.10 |
+5,564.10 |
| Higher Education Department |
47,619 |
50,077.95 |
+2,458.95 |
| Kendriya Vidyalaya Sangathan |
9,302.67 |
9,503.84 |
+201.17 |
| Navodaya Vidyalaya Samiti |
5,800 |
5,305.23 |
-494.77 |
Key Highlights of Union Budget 2025: Education Sector
Boost to School Education and Digital Learning
- Atal Tinkering Labs Expansion: The government announced the establishment of 50,000 Atal Tinkering Labs in government schools over the next five years, fostering STEM education and innovation.
- Broadband for Secondary Schools: To bridge the digital divide, broadband connectivity will be extended to secondary schools, ensuring digital learning accessibility.
- Bharatiya Bhasha Pustak Scheme: Indian language books in digital form will be made available, promoting multilingual learning.
Expansion of Higher Education and Research
- IIT Infrastructure Expansion: Five IITs, established after 2014, will receive additional funding for infrastructure development. IIT Patna will see special expansion support.
- AI Research Centres: A new Centre of Excellence (CoE) in AI for education receives an additional Rs 500 crore.
- PM Research Fellowship: Increased from Rs 350 crore to Rs 600 crore, adding 10,000 new fellowships for research at IITs and IISERs.
Skill Development and Medical Education
- Five National Centres of Excellence for Skilling will be set up under ‘Make for India, Make for the World.’
- Medical Education Boost: 10,000 new MBBS seats will be introduced this year, with a long-term plan to expand medical capacity by 75,000 seats in five years.
- National Institute of Food Technology to be established in Bihar.
Policy Shift Analysis
The budgetary focus on technical education reflects the government's push towards digital transformation and industrial growth. However, the cuts to IIMs and IISERs indicate a reduced emphasis on management and fundamental sciences.
Future Implications
- Technical institutions will expand their research infrastructure and increase student intake.
- Management education may witness greater privatization due to reduced government funding.
- Pure science research at IISERs could be impacted, potentially affecting India’s global research rankings.
- Increased funding for AI and skilling aligns with India's push towards emerging technologies.
The Union Budget 2025-26 underscores a strategic pivot towards strengthening India's technical and vocational education ecosystem, positioning the country for a future shaped by innovation and industrial growth.
Read More:
- Union Budget 2025: 50,000 Atal Tinkering Labs, 6,500 New IIT Seats, 10,000 MBBS Seats and More Announced for Education
- School Dropout Decline to 1.9% for Primary, 5.2% for Upper Primary, 14.1% for Secondary: Economic Survey 2024-25
- Industry Association Seeks Cost Reduction, Tax Reforms in Education Sector Ahead of Union Budget 2025
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