Financial aid for higher Edu loans boosted, UGC faces 61% Budget cut

New Delhi: The Centre on Tuesday announced financial support for loans up to Rs 10 lakh for higher education in domestic institutions even as it slashed the grant for the higher education regulator UGC by over 60 per cent.

The allocation for prestigious B-schools -- Indian Institutes of Management (IIMs) -- has also been reduced for the second consecutive year, according to the Union Budget.

The Budget for school education has been increased by over Rs 535 crore but the grant for higher education reduced by over Rs 9,600 crore from the previous fiscal year’s revised estimate (RE). The overall Budget allocation for the education sector has gone down by over Rs 9,000 crore. The Centre has allocated over Rs 1.20 lakh crore to the ministry of education for 2024-25 as against revised estimate of over Rs 1.29 lakh crore in the previous financial year. Presenting the Budget for 2024-25 in Parliament, Union finance minister Nirmala Sitharaman said that financial support will be provided for loans up to

Rs 10 lakh for higher education in domestic institutions.

She said e-vouchers for this purpose will be given directly to one lakh students every year with interest subvention of 3 per cent of the loan amount.

“For helping our youth who have not been eligible for any benefit under govt schemes and policies, the government will provide financial support for loans up to Rs 10 lakh for higher education in domestic institutions. E-vouchers for this purpose will be given directly to one lakh students every year with interest subvention of 3 per cent of the loan amount,” Sitharaman said. Union education minister Dharmendra Pradhan said the series of comprehensive and concrete measures announced by the finance minister will be a “win-win for all stakeholders — students, academia and industry”.

“This is going to fulfil aspirations of our youth, empower people with more livelihood opportunities, increase accessibility to quality education and skills and is also going to create over 4.1 crore new jobs in the next five years,” Pradhan said .

The Budget for research and innovation in educational institutions has gone up by Rs 161 crore. Similarly, the allocation for World Class Institutions has gone up from Rs 1,300 crore (RE) to Rs 1,800 crore.

The funding for the University Grants Commission (UGC) has been brought down to Rs 2,500 crore from the previous year’s RE of Rs 6,409 crore, a 60.99 per cent drop.