The record eighth full Budget of Finance Minister Nirmala Sitharaman is not only the most consecutive presentations by an FM but also comprehensively inclusive, responsive and exhaustive. This trinity of sorts makes Budget 2025-26 a springboard for economic activism, driven by encouraging consumerism, stimulating private investments, skilling the youth, creating new knowledge besides various other people-centric schemes to generate jobs and wealth. As an academic, my eyes roll down to the numbers that script a giant story with some interesting nuggets on education and its derivatives.
The financial prudence with which the Finance Minister has approached the major outlays need special mention. The capex story is not that of an isolated reductionist but of a collective expansionist with capex being 22 per cent of the total expenditure. This is a steady growth from 2015 Budget, which had a 14 per cent capex share of total expenditure.
This significant capex of ₹11.21 lakh crore towards public infrastructure shall create jobs to create consumer demand for businesses to increase their capex. The fiscal consolidation through an estimated fiscal deficit of 4.4 per cent of GDP for 2025-26, reducing debt-GDP ratio to 50 per cent by 2031 and the zero personal income tax for annual income up to ₹12 lakh to boost consumption along with other sectoral benefits, make this Budget a unique partnership between government and citizens for the nation’s progress.
Goddess Lakshmi’s slant on Goddess Saraswathi is visible with the Ministry of Education pushed upwards and ranked ninth (single digit rank in recent times) in terms of percentage of total government expenditure. The ₹1.28 lakh crore for Education Ministry is a 12.8 per cent increase over the revised estimates for 2024-25, making it the largest proportionate increase amongst all ministries.
One might still argue that it’s low when compared to global standards. The fact of the matter is that education continues to be close to the ministry’s heart despite it being in the Concurrent List.
Multiplier effect
With school education being the primary task of government, the 7.7 per cent increase in higher education is less than education’s overall 12.8 per cent and understandable. However, the multiplier effect that the collaborative potential with other agencies can create is the foundational investment for knowledge and skill-based growth in India’s socio-economic wealth. The special budgetary provision of ₹20,000 crore through the Department of Science & Technology to promote research and innovation through private partnership and the Prime Minister’s Research Fellowship of ₹600 crore (doubled) to create 10,000 research fellows in IITs & IISc (could have been in top 100 NIRF institutions) catalyse new knowledge creation.
The ₹1,000 crore increase in various research and innovation schemes, infrastructure expansion plans and student-aid increase gradual enrolment and output.
The ₹500 crore for establishing a Center for Excellence in AI education is hopefully geared towards building capacity to train learners on the use of AI in life and business. Hopefully, this is not spent on R&D as ₹500 crore is insignificant for any new capability building.
The ₹1,180 crore allocation (almost a 200 per cent increase) for apprenticeship training and the proposed five national centres of skilling excellence coupled with Ministry of Skill & Entrepreneurship Development’s ITI upgradation budget of ₹3,000 crore (300 per cent increase), and the PM Internship Scheme through the Corporate Affairs Ministry with an allocation of ₹10,800crore (almost 500 per cent increase), propel India’s youth to the ideals of ‘Make for India, Make for the World’ initiative.
The Budget value chain insofar as education is concerned transcends ministries and stretches from new knowledge creation to vocational education for skilling. While the NEP 2020 aims at multidisciplinary education, the Budget has aimed at multi-ministerial allocation for education, which has other partner ministries from which it can draw finances through various schemes that define the future of work, education, livelihood and life.
The World Economic Forum’s Future of Jobs report 2025 has identified AI and information processing technologies, robots and autonomous systems, energy generation, storage and distribution, new materials and composites and semiconductors and computing as the top five technologies that shall drive business transformation necessitating new-age workplace skills.
The Budget seems to be mindful of this with the right allocation to education. Education 1.0 budget during NDA 1.0 was a ‘re-organiser’ and Education 2.0 budget during NDA 2.0 was a ‘re-imaginer’. This Education 3.0 budget for Industry 4.0 has the potential to be a game-changer.
The writer is Vice-Chancellor & Tata Sons Chair Professor of Management, SASTRA University. Views are personal