As India looks ahead to the next Union Budget, the education sector is calling for sharper focus, deeper investment, and a renewed commitment to skilling for the future workforce. While Budget 2025 brought a modest boost in funding, educators and industry leaders say the moment now demands more targeted action.
Education Allocation Sees Moderate Growth
While presenting the Union Budget 2025, Finance Minister Nirmala Sitharaman allocated Rs 1.28 lakh crore to the education sector, marking a 6.22 per cent increase compared to 2024. Despite the rise, the allocation still fell short of the 6 per cent of GDP target recommended under the National Education Policy (NEP) 2020.
Out of the total outlay, Rs 50,077.95 crore was earmarked for higher education, reinforcing the government’s focus on universities and advanced learning. Also,the Budget also announced Rs 500 crore for establishing an Artificial Intelligence Centre of Excellence in education, signalling intent to align learning with emerging technologies.
Big-Ticket Announcements: Digital Push and Youth Opportunities
The Budget outlined several ambitious initiatives aimed at modernising the education ecosystem. These included broadband connectivity for schools, plans to expand five third-generation IITs, and enhanced funding for Indian knowledge systems. Moreover, another key highlight was the emphasis on internship programmes for youth, designed to bridge the gap between education and employment.
Yet, as industries rapidly evolve, experts argue that funding alone is not enough.
Skilling: A National Imperative, Not Just an Industry Demand
With another Budget on the horizon, leaders across education and technology are urging policymakers to place skilling at the heart of India’s growth strategy.
“The upcoming Union Budget must place skilling firmly at the centre of India’s growth agenda,” said Abhimanyu Saxena, Co-Founder of Scaler. He pointed out that in an AI-driven economy, industries continue to struggle with a shortage of professionals who possess future-ready, applied skills.
According to Saxena, employability today is no longer defined by fixed roles but by continuous upskilling and long-term relevance. Addressing the skills gap, he noted, has become a strategic national priority, not just a business concern.
Building Future-Ready Skills From an Early Age
The push for skilling is not limited to higher education. There is growing emphasis on introducing application-based learning and STEM education at the school level.
“There is a timely opportunity to strengthen STEM education and skill-oriented learning from an early stage,” said Shweta Sastri, Managing Director, Canadian International School, Bangalore. She stressed that early exposure helps students develop adaptability and prepares them for future careers that may not yet exist.
Teachers at the Core of Education Reform
As the corporate sector grapples with layoffs and hiring freezes, experts believe educators must also stay aligned with the rapidly changing job market.
“Empowering educators through continuous professional development and digital upskilling must be a priority,” Sastri said, calling teachers the cornerstone of any high-performing education system.
Infrastructure Challenges and Shifting Enrolment Trends
Data highlights both challenges and opportunities within India’s education landscape. Over the past six years, the number of government schools has declined. Additionally, UDISE+ 2023–24 data released by the Ministry of Education revealed a drop of 88 lakh students in government school enrolment compared to the previous year.
However, there is a silver lining. The Gross Enrolment Ratio (GER) in higher education rose from 23.7 per cent to 28.4 per cent, reflecting growing demand for college and university education.
With more students entering higher education, institutions are facing increased pressure to expand and modernise infrastructure.
Investing in Infrastructure for Better Learning Outcomes
“We look forward to a meaningful increase in this year’s budget to strengthen skilling, accelerate digital transformation, and invest in infrastructure,” said Ravin Nair, Managing Director, QS I-GAUGE. Moreover, he emphasised that improved facilities are especially crucial for underdeveloped and rural regions.
Echoing similar views, Sastri highlighted that infrastructure alone is not enough. However, improving teaching quality, innovation, and holistic development must go hand in hand.
“As the Union Budget approaches, we look ahead with optimism that education will continue to receive focused, future-oriented attention,” she said. “Sustained investment in teacher training, modern learning spaces, and technology-enabled classrooms is essential to foster inclusion, curiosity, and critical thinking.”
