Education Budget 2026 Highlights: ‘Education sector allocation below 6% that NEP envisions’

The focus on Orange Economy with emphasis on art, design and innovation will promote digital content creation capacity in the country. A much needed focus on applied psychology, behavioural science, mental health, wellness and yoga has found voice in the budget. Given the rise in mental health issues, more open discussions about such traumas, and autoimmune diseases, one wishes for at least one NIMHANS in each of the four zones.

--P. G Babu, Vice-Chancellor, Vidyashilp University

The Union Budget 2026 reflects a clear intent to build a future-ready education ecosystem aligned with the realities of a rapidly evolving world. The focus on AI, creative technologies, and skill-linked learning signals a welcome shift from rote education to meaningful, application-driven learning. Initiatives such as regional education infrastructure, university townships, and dedicated STEM hostels for girls are progressive steps toward inclusivity and equal opportunity. Strengthening vocational, design, and interdisciplinary pathways will empower students to explore diverse career choices with confidence. This budget reassures educators and parents that policy is steadily moving toward holistic student development and long-term national growth.

--Dr. Neelima Kamrah, Principal, KIIT World School

The setting up of an ‘Education to Employment and Enterprise’ Standing Committee, with a focus on the services sector, and its mandate to recommend measures for driving growth, job creation, and technological exports—including artificial intelligence—is a timely and forward-looking step aligned with future job and skill requirements. With India sustaining nearly 7% economic growth and consumption increasingly formalizing, the Union Budget creates a rich learning and leadership landscape for management education. The Budget also empowers women in STEM, youth, and entrepreneurs by expanding access to technology and creating new opportunities.

Amid the increased uncertainty and complexity in the technology ecosystem and world order, a key focus on industry-led research and training centres will accelerate technological development and help build a future-ready, skilled workforce. Collectively, these initiatives will strengthen the economy, enhance skill development, and support India’s journey towards Viksit Bharat, especially as global demand and attention increasingly turn towards India

--Dr. Pankaj Priya, Deputy Director and Dean Academics, Birla Institute of Management Technology (BIMTECH)

The Union Budget 2026 highlights India’s push for a tech-driven, inclusive future under the three-Kartavya framework, focusing on youth, women, and disadvantaged groups. AI and emerging technologies remain central to economic transformation, with emphasis on execution, innovation, and digital infrastructure. Strengthening STEM education—especially for women—aims to bridge gender gaps, foster skills, and build a pipeline of technologists driving India’s digital economy and global AI leadership.

--Rajeev Tiwari, Founder & CFO, STEMROBO

Chartered accountants' apex body ICAI on Sunday said the proposals in the 2026-27 Union Budget aim to establish a stable regulatory environment that enables enterprises to concentrate on innovation and growth. ICAI President Charanjot Singh Nanda said proposals in the Budget align with the overarching objective of the Income Tax Act, 2025 -- simplifying legal language and mitigating litigation to foster trust and accelerate decision-making.

"By ensuring transparency and precision in the law, these measures aim to establish a stable regulatory environment that enables enterprises to concentrate on innovation and growth, thereby advancing the ease of doing business," he said in a statement. The Institute of Chartered Accountants of India (ICAI) has more than 5 lakh members.

He also welcomed the proposal for corporate mitras to help MSMEs (Micro, Small and Medium Enterprises) meet compliance requirements.

"ICAI is happy to be entrusted with the task of designing short-term, modular courses and practical tools to develop a cadre of 'corporate mitras', especially in Tier-II and Tier-III towns to help MSMEs meet compliance requirements at affordable costs," he said.

In her speech, Sitharaman said the government will facilitate professional institutions such as ICAI, ICSI, and ICMAI, to design short-term, modular courses and practical tools to develop a cadre of 'corporate mitras', especially in Tier-II and Tier-III towns. These accredited para-professionals will help MSMEs meet compliance requirements at affordable costs.

Separately, the Institute of Company Secretaries of India (ICSI) said the Budget emphasises on strengthening human capital through education, skilling, building digital infrastructure, innovation, and research, along with accelerating regulatory reforms to improve business environment and voluntary compliance. It also appreciated the government's proposal for developing corporate mitras to help MSMEs.

Education today is closely linked to technology shifts and job readiness. It is heartening that the Union Budget 2026 recognises and works towards fulfilling that need, signalling that it is truly a budget for the youth of India.

The Budget clearly reiterates the importance of linking education with employability which can be seen through emphasis on integration of emerging technologies in curriculum including AI-led learning right from school to higher education as well emphasis on skill development.

The decision to launch AVGC (animation, visual effect, gaming and comics) Content Creator Labs in 15,000 schools and 500 colleges is a forward looking step, as we know that this sector will require millions of professionals and we are finally moving beyond rote-learning methods to make Bharat skill-based and future-ready right from the classroom. We welcome the announcement of the high level 'Education to Employment and Enterprise' committee because it has the potential to bridge the gap between degrees and employability.

Along with being futuristic, the Budget is inclusive with its focus on improving regional education infrastructure, university townships, and hostels for girls pirsuing higher education in STEM institutions.

On the financial side, reducing the TCS rate for overseas education to 2% is a great move for students aspiring to pursue education abroad. However, to truly democratize education for the masses within India, we still need to address the GST on educational services. Affordability is the key to access, and that remains our next big challenge.

--Prateek Maheshwari, Co-Founder, PhysicsWallah

Commenting on the Budget 2026–27, Dr. Pushpendra P. Singh, Dean CAPS & Project Director, ANNAM.AI, IIT Ropar, said, “The Union Budget 2026–27 strongly reflects Prime Minister Shri Narendra Modi’s vision of transforming Indian agriculture through technology and innovation. The launch of Bharat Vistaar is a significant step towards empowering farmers with AI-driven, real-time, climate-smart support, helping them make informed decisions, reduce risks from unpredictable weather, optimize inputs, and ultimately improve yields and livelihoods. The continued focus on precision agri-tech practices supports efficient, sustainable, and climate-resilient farming while enhancing farmers’ incomes. This Budget rightly positions AI and digital innovation as key enablers of a future-ready farm sector.”

In urban areas, the enrolment rises from the middle to the secondary level. Grade-wise enrolment trends further highlight the decline at the secondary stage.

The survey also highlights that India has made notable gains in school enrolment by strengthening infrastructure and teacher capacity, with schemes like Poshan Shakti Nirman and Samagra Shiksha Abhiyan promoting access and equity.

“Further action is required, especially as the focus shifts from enrolment to learning outcomes. Policy interventions to expand composite and integrated schools, upgrading schools up to Class 7, and strengthening open schooling are vital for improving retention and optimising resources,” it said.

As the Viksit Bharat Shiksha Adhishthan Bill, 2025 raises expectations around compliance and accreditation, it is vital that the Budget also enables smaller universities to participate meaningfully in research. Even modest, well-structured funding for small research projects and basic lab infrastructure can make a decisive difference. Without such support, capable institutions and regional talent risk being inadvertently disadvantaged. Thoughtful funding provisions will ensure that regulatory reform strengthens, rather than narrows, India’s academic and research ecosystem

--Prof. P S Sastry, Dean & Distinguished Professor, School of Engineering and Technology, Vidyashilp University

My expectation from the upcoming budget is that education must be made both affordable and accountable. A key step toward this is reducing the current 18% GST on educational services, which places a heavy burden on families. Lowering this rate is essential to ensure that quality learning becomes accessible to all.

Equally important is a shift toward outcome-based budget allocation. This approach would be truly transformational for Bharat, as it shifts the focus from mere expenditure to measurable impact. Instead of funding only infrastructure, resources should be directed toward tangible results—improved learning outcomes, enhanced employability, and skill development.

By linking budgetary spending to performance, we can guarantee that every rupee invested directly empowers our youth and contributes to building a skilled, self-reliant nation.

--Prateek Maheshwari, Co-Founder, PhysicsWallah

Under the vision of Viksit Bharat 2047, skill development must evolve from intent to large-scale implementation. The education budget for this year should place clear emphasis on industry-integrated and multidisciplinary curricula, a robust research-driven framework, and the cultivation of future-ready skills. Equally vital is sustained investment in vocational education, advanced research, and faculty upskilling. To align with global standards, India must design agile education systems that seamlessly combine academic excellence with employability, innovation, and international exposure. Strategic public investment in skills and higher education will serve as the foundation for building a globally competitive, innovative, and self-reliant India.

--Prof. Dr. Atul Kumar Nasa, Pro Vice Chancellor, SGT University.

Piyush Kumar, Regional Director, South Asia, Canada, and LATAM at IDP Education, points to rising aspirations for global education across income groups. “International education plays a vital role in building a globally competitive workforce. Greater financial support and scholarship options will enable students to access global education irrespective of their economic background,” Kumar says.

With over 18 lakh Indian students studying abroad in 2025, overseas education now functions as an extension of India’s higher education system, financed almost entirely by Indian households. In the same period, education-related outward remittances under the Liberalised Remittance Scheme (LRS) declined from about $3.48 billion in FY 2024 to roughly $2.92 billion in FY 2025, a 16 per cent adjustment. Student mobility remained steady, which suggests families are reorganising tuition and settlement payments because of higher costs, proof-of-funds requirements, and compliance procedures across multiple countries.

This trend, according to Saurabh Arora, founder and CEO of University Living, points to the need to update the three systems that shape overseas study financing: credit, remittance, and taxation. Education loans for international study are still priced higher than domestic credit, LRS transactions introduce working-capital pressure through TCS, and benefits such as Section 80E are unavailable to most young earners under the new tax regime.

Dr Sunil Shukla, Director General of the Entrepreneurship Development Institute of India (EDII), calls for embedding entrepreneurship as a national growth strategy. “The Budget should strengthen entrepreneurship through enhanced credit guarantees, blended finance models, and interest subvention for startups and micro-entrepreneurs,” he says. He believes such measures are critical to sustaining India’s position as a global startup powerhouse.

A recurring theme across experts is the need to move beyond basic research funding towards commercialisation and real-world impact. Professor Thillai Rajan A, IIT Madras faculty and head of CREST, calls for dedicated budgetary mechanisms to support institutional innovation.

He proposes an ambitious national initiative: “An initiative to create ‘One Hundred Innovation Universities’, each mandated to deliver at least one breakthrough innovation annually, can significantly accelerate India’s innovation output.”

Echoing the need for translational research, Professor Ramgopal Rao adds: “India needs fit-for-purpose translational research institutions that bridge academia, industry, and startups – de-risking early-stage innovation and accelerating adoption.”

Calling for a long-term approach to strengthening India’s higher education ecosystem, Professor V Ramgopal Rao, group Vice Chancellor, BITS Pilani, and former director of IIT Delhi, says the Budget must prioritise scale with quality.

“India must build world-class higher education capacity at home so talented students see credible options within the country, not only abroad,” Professor Rao notes.

He adds that as global student mobility patterns shift, India has an opportunity to emerge as a serious destination for advanced study and research – provided academic depth and institutional flexibility are strengthened.

The Education Budget for Science and Humanities must emphasise promoting experience-based training at the high school and undergraduate levels, Prof Krishanu Ray, Department of Biological Sciences, BITS Pilani, notes. For this purpose, a national guideline and framework should be developed for the educational institutions.

Former Ambassador of India and co-chair, School of Global Leadership, Gautam Bambawale, adds that as India opens up to foreign universities, equal focus is needed on helping Indian institutions expand overseas. He calls for diplomatic support, research financing mechanisms, and outcome-linked tax incentives to treat education as a strategic export.

From improving school learning outcomes and implementing NEP 2020 in full, to building innovation-led universities, accelerating translational research, fostering entrepreneurship, and making digital education more affordable, expectations from this year’s Budget are both ambitious and wide-ranging.

On higher education, the Survey acknowledges the rapid expansion of institutions and student enrolment over the past decade, but flags concerns around quality, faculty shortages and uneven research capacity. It calls for greater institutional autonomy, stronger academic leadership and deeper integration of research and innovation to make Indian universities globally competitive.

The Survey also highlights the importance of experience-based and skill-oriented learning, noting that traditional classroom-led models often fail to connect theory with application. Greater emphasis on vocational education, internships and industry collaboration is seen as essential to improve employability and align education with labour market needs.

While in urban areas, the enrolment rises from the middle to the secondary level. Grade-wise enrolment trends further highlight the decline at the secondary stage. The survey also highlights that India has made notable gains in school enrolment by strengthening infrastructure and teacher capacity, with schemes like Poshan Shakti Nirman and Samagra Shiksha Abhiyan promoting access and equity. “Further action is required, especially as the focus shifts from enrolment to learning outcomes. Policy interventions to expand composite and integrated schools, upgrading schools up to Class 7, and strengthening open schooling are vital for improving retention and optimising resources,” it said.

The Economic Survey 2025-26, released, highlights the need to retain school students beyond Class 8 as the secondary age-specific net enrolment remains low. According to the survey tabled in Parliament on Thursday by Union Finance Minister Nirmala Sitharaman, while India has achieved near-universal enrolment at the school level, it cautions that gains in enrolment have not translated uniformly into learning outcomes, particularly beyond the elementary stage, where net enrolment rate (NER) remains low at 52.2 per cent. It said the scenario highlights the need to retain students beyond Class 8.

The economic survey 2025-26, tabled in Parliament on Thursday by Union Finance Minister Nirmala Sitharaman, highlighted that there is a need to retain school students beyond Class 8 as the secondary age-specific net enrollment remains low.

In the previous year’s Union Budget, the government promised that in the next 5 years, 75000 more seats will be added in the medical colleges, and the government will give a boost to the infrastructure of IITs set up after 2014.