Delhi university faces Rs 462 crore deficit amid rising student fees and UGC grant shortfall

Delhi university faces soaring Rs 462 crore deficit, faculty alarmed over rising student fee dependence

Delhi University (DU) is grappling with a mounting financial crisis, with its projected deficit for the financial year 2025–26 touching a staggering Rs 462.4 crore — a sharp 86% rise from last year’s shortfall. Despite a modest increase in allocations from the University Grants Commission (UGC), the institution is unable to cover even basic expenditures like salaries and recurring operational costs, prompting strong concerns from faculty over the growing reliance on student fees and internal revenue to keep the university afloat.

As per a Times of India report, DU’s financial statement presented to the executive council on July 12 reveals that while UGC allocated Rs 473 crore for salaries in FY 2024–25, the university’s actual salary expenses touched Rs 478.7 crore, already exceeding the grant by Rs 5.7 crore. The recurring expenditure — covering infrastructure maintenance, library services, and other essentials — stood at Rs 544.4 crore against a UGC allocation of Rs 313 crore, creating a yawning gap of over Rs 248 crore. Projections for 2025–26 are even grimmer, with an estimated salary bill of Rs 540.7 crore and recurring costs of Rs 683.1 crore, compared to allocations of Rs 488 crore and Rs 323 crore respectively.

A significant portion of DU’s internal revenue is now sourced from student contributions. Earlier this month, DU hiked its 'university development fund' by nearly 20% — double the usual annual increment — a move justified as a response to inflation but criticized for burdening students. Over the past three years, some fee components have risen by over 200%.

The situation is further complicated by DU’s ambitious infrastructure expansion plans under the Higher Education Financing Agency (HEFA) model. While the Ministry of Education covers 90% of the interest on HEFA loans, DU is liable for the remaining 10%. For a proposed outlay of Rs 938.3 crore, the university would be responsible for approximately Rs 93.8 crore in interest payments. Faculty members argue that such a model compels DU to continually raise funds — often through fee hikes — to service debt, potentially compromising access and affordability for students.

Adding to the concerns, UGC’s grant for capital expenditure under the Economically Weaker Section (EWS) scheme has dropped significantly — from Rs 32.8 crore in FY 2024–25 to just Rs 10 crore in 2025–26 — while DU’s projected spending under this head has surged to Rs 60 crore. Internal documents also show the university is aiming to generate Rs 246 crore in student fee revenue in 2025–26, up from Rs 237.3 crore in the current fiscal year.

As DU continues to bridge the gap between insufficient grants and growing expenses through internal revenue, questions loom large over the future of public higher education and its accessibility in India.