India's educational system is awaiting a suitable budget

All eyes are on whether the government will increase funding for education.

By Brajesh Kumar Tiwari 

The enrolment figures in schools across the country present a worrying picture. According to the recent report from the Integrated District Education Information System (UDISE Plus) of the Ministry of Education, the number of enrolments in schools in 2023-24 was 24.80 crore, which is 37 lakhs fewer than the 25.17 crore students of 2022-23. However, in percentage terms, this decline is only 1.5 percent. The steepest decline is at the secondary level, where the number of students has decreased by about 17 lakhs. In the primary stage, from class 2 to 5, enrolments have dropped by 7 lakhs, while the middle stage (classes 6 to 8) has seen a decline of more than 3 lakhs. However, there has been an increase of about 29 lakhs in pre-primary school enrolments, rising from 1.01 crore in 2022-23 to a projected 1.30 crore in 2023-24. The ministry attributes the decline in enrolment to the new method of data collection.

This gap poses a significant challenge for the education sector, as "reducing school dropouts and ensuring universal access to education at all levels by 2030" is a primary goal of the National Education Policy (NEP) 2020 and the Sustainable Development Goals (SDGs). According to the Ministry of Education's data, only 57 percent of schools in the country have computers, and 53 percent have internet facilities. Additionally, 10 percent of schools are still without basic amenities such as electricity or separate toilets for boys and girls. This highlights the urgent need to improve infrastructure and take concrete steps towards increasing school enrolments and enhancing the quality of education through government efforts and awareness campaigns.

India, one of the oldest civilisations in the world, has a rich knowledge tradition that laid the foundation for science and technology in ancient times. Historical educational institutions like Takshila and Nalanda University produced renowned scholars such as Chanakya, Charak, and Sushrut. However, one might wonder how a country with such a strong educational and research heritage fell so far behind. A significant answer lies in the fact that education and research have not received the same attention as they have in other countries. Under various articles of the Indian Constitution, every child between the ages of 6 and 14 has the fundamental right to free and compulsory education. However, education, which is on the Concurrent List, has rarely been a priority for either central or state governments.

India's education sector ranks 32nd globally according to the US News & World Report. In 1964, the Kothari Commission recommended increasing the education budget from 2.9 percent of GDP to 6 percent, but even after five decades, the country's education expenditure has never exceeded 3.5 percent of GDP, despite the NEP 2020's call for 6 percent. Countries like China, Japan, and South Korea invested heavily in education during the 1960s, while India still awaits proper funding. Other developing nations such as China, Brazil, and Argentina spend 4.2 percent, 6.2 percent, and 5.5 percent of GDP on education, respectively. Even Cuba, a poorer country, spends around 12 percent. India, with an average age of 28, spends just 0.7 percent of GDP on research and development (R&D), well below the global average of 1.8 percent.

Education is a sector where investment has far-reaching effects. When the workforce is more skilled, economic development accelerates, social problems decrease, and women's safety improves. For example, the 80 crore people receiving free food grains in India are likely unskilled. Without adequate food, how can they develop new skills? In the current era, skill development, reskilling, and upskilling are essential.

It is crucial to invest the funds from various 'Rewadi Schemes' running in the country into the education sector. In 2023, India's average per capita income was $2,600. States with strong education systems, such as Kerala, Telangana, and Tamil Nadu, have per capita incomes of around $4,000, while states like Bihar and Uttar Pradesh, where education is lagging, have per capita incomes under $1,000. UNESCO and World Bank studies estimate that every dollar invested in primary education yields a return of 15–25 percent.

According to a survey by ASSOCHAM, the cost of education in India is rising rapidly, and the Goods and Services Tax (GST) on educational services should be reduced from 18 percent to 5 percent or zero. Fellowships in higher education should be increased, education loans should be available at affordable rates, and a subsidy scheme for skill-based courses should be introduced in the new budget. Additionally, expenditure on Ed-Tech should be tax-exempt for taxpayers under Section 80C. The creation of 'Institutes of Eminence' cannot be achieved merely by naming institutions; substantial funding is necessary. While the government may not be able to finance all projects, corporate houses must be encouraged to invest their Corporate Social Responsibility (CSR) funds into education. Moreover, provisions should be made in the budget for upskilling teachers to ensure that schools and colleges evolve into "learning organisations."

To bolster the education budget, the Government of India introduced a 2 percent Education Cess in 2004, which was later replaced by a 4 percent Education and Health Cess through the Finance Bill 2019. This cess, though not a permanent revenue source, has funded 70 percent of the total education expenditure since 2015. This reliance on cess is concerning, as it is not a sustainable way to finance the education sector.

As the budget is set to be presented on 1 February, all eyes are on whether the government will increase funding for education. At a time when important exams in the country are plagued by paper leaks, and controversies are widespread, the pressing question is whether the government will allocate more resources to education. With the National Education Policy (2020) having completed four years on 29 July, it is clear that without additional funding, the successful implementation of its recommendations across the country will remain a distant dream.

(Dr. Brajesh Kumar Tiwari is Associate Professor at Atal School of Management (ABVSME), Jawaharlal Nehru University (JNU), New Delhi.)

Views are personal, and do not represent the stance of this publication.