The education interim budget in India has undergone a 7 percent reduction, with a substantial 61 percent cut in the allocation for the University Grants Commission (UGC). While the budget for schools experienced a slight decrease, funding for higher education saw a significant decline. Experts have expressed concerns about the potential repercussions on universities and students, prompting the UGC to underscore its dedication to maintaining quality higher education despite the financial constraints. Notably, grants for central universities witnessed a 28 percent increase, but support for Indian Institutes of Management (IIMs) was scaled down for the second consecutive year.

In the recently presented interim budget, Rs 1.2 lakh crore was allocated for education, marking a roughly 7 percent reduction compared to the revised estimate for 2023-24. Notably, the University Grants Commission (UGC) faced a substantial 61 percent cut, the largest in at least five years. As per the budget document, out of the total outlay, Rs 73,008.10 crores were allocated for schools, showing a marginal 0.73 percent decrease from the revised estimate for 2023-24. Meanwhile, higher education received Rs 47,619.77 crore, experiencing a significant reduction of Rs 9,600 crore.

During her budget address, Union Finance Minister Nirmala Sitharaman stressed the Bharatiya Janata Party (BJP) government’s aim to transform education using the National Education Policy (NEP) 2020 and said the focus is on empowering the “Amrit Peedhi” (the generation that will grow during Amrit Kaal, or the 25 years leading to 2047). "Our prosperity depends on adequately equipping and empowering the youth. The National Education Policy 2020 is ushering in transformational reforms. PM ScHools for Rising India (PM-SHRI) are delivering quality teaching, and nurturing holistic and well-rounded individuals", she said, during the speech.

However, funding for UGC was pared down significantly. The allocation was cut from a revised estimate of Rs 6,409 crore in 2023-24 to Rs 2,500 crore in 2024-25. Experts raised concerns over the decrease in the UGC budget. UGC Chairperson M Jagadesh Kumar in a statement said, “There has been an overall increase of Rs 12,024 cr (19.56%) in the Budget Allocation of Department of School Education and Literacy in the FY 2024-25 from RE 2023-24".

Kumar further said the commission remains committed to its core mandate of supporting quality higher education. “It will continue to work in synergy with all stakeholders to ensure the efficient use of allocated funds. We are confident that the strategic distribution of resources and NEP 2020 transformative vision will build a learner-centric higher education system in India", he said.

Conversely, there was a substantial 28 percent increase in the budgeted grants for central universities, rising to Rs 15,928 crore from the previous year's revised estimate of Rs 12,394 crore. In the fiscal year 2023-24, the budget estimate in the document surpassed the previous year's figure of Rs 11,528 crore. Central universities saw a revised estimate increase to Rs 12,394 crore. While support for Indian Institutes of Technology (IITs) decreased by Rs 59.7 crores compared to the revised estimate, funding for the National Institutes of Technology (NITs) and Indian Institute of Engineering Science and Technology increased by Rs 220 crores.

Nevertheless, for the second consecutive year, the budget for Indian Institutes of Management (IIMs) has been reduced. The allocation for these top-tier business schools has seen a decline from Rs 608.23 crore in 2022-23 to Rs 300 crore in 2023-24, and further down to Rs 212.21 crore in 2024-25. Describing the budget, Union Education Minister Dharmendra Pradhan characterized it as a crucial step towards achieving a "Viksit Bharat" (developed India).