Hike in budget for Indian higher education ‘masks wider issues’

India’s latest budget has promised fresh investment in research infrastructure, but scholars warn this masks slower funding growth for universities and mounting financial pressures across the sector.

Finance minister Nirmala Sitharaman has confirmed The Ministry of Education budget will rise by 14.2 per cent in 2026-27.

However, Narender Thakur, professor in the department of economics at the University of Delhi, said that the real-terms increase was “closer to 12.5 per cent” after accounting for inflation and “masks deeper problems” in public funding.

He added that the actual education budget for 2025-26 was cut by 5.2 per cent, compared with the original estimate and so funding could be reduced further still.

Higher education, Thakur said, had benefited far less than the overall ministry allocation, rising by 8.5 per cent or 6.8 per cent in real terms.

He also highlighted pressure on public universities. Grants to central universities rose by just 1.5 per cent, which he said amounted to a real-terms decline and reflected “no priority for public funded higher education”.

Funding increases for central bodies were similarly modest, Thakur added, and allocations for the University Grants Commission rose only 5.2 per cent in real terms, while funding for the Indian Institutes of Technology increased by just 3.1 per cent in real terms.

Thakur was particularly critical of the government’s continued reliance on student and institutional loans, which he said would lead to higher costs for students and widening socio-economic inequality in higher education.

Alongside the funding allocations, Sitharaman announced the creation of five “university townships” near major industrial and logistics corridors. Being seen as a new model of higher education, these are planned to host universities and research institutes near clusters of factories, ports and transport hubs.

The budget also pledged to establish one girls’ hostel in every district to address challenges faced by female students, particularly in science, technology, engineering and mathematics fields that require extended laboratory hours.

Additional measures included support for astronomy and astrophysics through the development or upgrading of four telescope facilities, including the National Large Solar Telescope and the Himalayan Chandra Telescope.

Some private-sector providers welcomed the emphasis on skills and employability.

Ranjita Raman, CEO at Jaro Institute of Technology Management and Research Limited, said the budget made “a strong and timely push towards building a workforce that is ready for the future and aligned with India’s...2047 goals”.

She added that “the proposal to develop university townships near industrial corridors and to set up an Education to Employment and Enterprise Standing Committee reflects a practical, outcome-focused approach, especially for strengthening the services sector”.

Raman also welcomed the reduction in tax collected on education and medical expenses from 5 per cent to 2 per cent, which she said would “ease financial pressure on learners and working professionals and encourage greater participation in higher education and career progression”.

tash.mosheim@timeshighereducation.com