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Impact of Union Budget 2021-22 on the Education and Skill Development Sector

The total allocation for the Education Sector stood at Rs. 54,873.66 crore for school education and Rs. 38,325.15 crore for higher education in Budget Estimate.

The Budget proposals for 2021-22 rest on six pillars: health and well-being, physical and financial capital and infrastructure, inclusive development for aspirational India, reinvigorating human capital, innovation & R&D, Minimum Govt & Maximum Governance. The fourth pillar of Union Budget of FY 2021-22, the Indian education sector got Rs. 93,224 crore boost after the Union Budget announcement by Finance Minister Nirmala Sithraman. The total allocation stood at Rs. 54,873.66 crore for school education and Rs. 38,325.15 crore for higher education in Budget Estimate.  

In July 2020, the Cabinet gave its nod to the National Education Policy 2020. Consequently, the Human Resource Development Ministry has been renamed as the Ministry of Education. In the aftermath of the new norms set by NEP 2020, the Central Government has liberalised the regulations which impact internationalisation strategies of academia-industry partnerships and higher education of students. The Budget Estimates provide various measures of improving human resources in the Indian education system, and provide access to quality education.


In alignment with objectives set by NEP 2020, 15,000 schools will be qualitatively strengthened across the country and will serve as exemplar schools in that region. On the basis of the qualitative benchmarking set by these institutions, schools of that region will be expected to enhance their educational standards. 

Further, 100 new Sainik schools will be set up in partnership with NGOs, private schools, and states. The finance minister also said that these 100 new Sainik schools will be set up in India as part of education for all. 

National Professional Standards for Teachers (NPST) will be developed to set standards for school teachers. This will impact around 92 lakh teachers currently in the public and private schools in the country. 

750 Eklavya Model Residential Schools will be set up in Tribal areas. The cost of each school will be increased to Rs 38 crores and for those schools in hilly and difficult areas, the unit cost to set it up will be Rs 48 crores. Central Assistance for Post Matric Scholarship Scheme for students from Scheduled Castes will be Rs 35,219 crores for six years (till 2025-26).

The Union Budget has broadened the horizon for privatisation of public schools, and increased PPP models governing educational institutions in India. As the Finance Minister aims to develop inclusive growth of the Indian schools and improve access to quality education in Tribal regions, it will be imperative to seek support from the private sector in providing quality education and infrastructure and skillset workshops to the faculty.    


In lieu of the internationalisation measures mentioned in NEP 2020, Finance Minister Nirmala Sithraman announced partnerships with the United Arab Emirates (UAE) to benchmark the skill levels of the Indian workforce and with Japan for skill transfer. 

A National Digital Educational Architecture (NDEAR) will be set up to support teaching and learning activities. The digital architecture set up under this will also help in educational planning, governance, and administrative activities of the Centre and the States/ Union Territories. National Initiative for School Heads and Teachers for Holistic Advancement (NISTHA) will train 56 lakh school teachers in 2021-22 digitally. 

The Union Budget has set amiable rules for the technology industry and has bolstered the inclusion of digital architecture. The edtech sector of India can initiate strategies to assist educational planning/ governance/ administrative activities of schools and universities of India. This will support the advancement of faculty training as well as the digital integration of the national HEIs. Moreover, initiatives like InvestIndia can aid the internationalisation of skill development in India, with assistance from UAE, Japan, and other countries.  


The government is keen on implementing qualitative assessment both at a school and high education level. A legislation implementing a Higher Education Commission (HEC) will be introduced in the coming year. It will be an umbrella body with four verticals to oversee standard-setting, accreditation, regulation, and funding of the HEIs of 9 Indian states. 

Formal umbrella structures will be set up to bring research institutions, colleges and universities in nine cities. These will help institutions have better synergy and also retain their internal autonomy. A ‘Glue Grant’ will be set up for this purpose.

The Rashtriya Uchtar Shiksha Abhiyaan (RUSA) got a Rs 3,000 crore allocation in BE 2021-22 as against Rs 166 crore in the revised estimate 2020-21. RUSA is a centrally-sponsored scheme that aims to improve the quality of institutes, promotes self autonomy and aims to ensure adequate availability of quality faculty in all higher educational institutions. This scheme also promotes diversity including inclusion of SC/ST, minorities and women in the higher education system.

As an effect of such umbrella structures, HEIs may require to establish a forum to moderate and maintain the four verticals set by the HEC. After the legislation of the HEC, the Indian institutions must have a structured in-house mechanism to meet the standardisations set by this commission.   

Source: Business World

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