Union Budget 2020-21 allocates Rs.99,300 crore for Education, Rs. 3,000 crore for Skill Development

The Union Minister for Finance and Corporate Affairs, Smt. Nirmala Sitharaman along with the Minister of State for Finance and Corporate Affairs, Shri Anurag Singh Thakur arrives at Parliament House to present the General Budget 2020-21, in New Delhi on February 01, 2020.

150 Higher Educational Institutions to start apprenticeship embedded degree/diploma courses by March, 2021;

Special bridge courses for nurses, para medical staff and care givers to enhance their employability abroad


Ind-SAT to be conducted in Asia and Africa under Study in India programme,

External Commercial Borrowings and FDI to be encouraged for financing education infrastructure;

Degree level online education programmes for students of deprived sections of the society


A total outlay of Rs.99,300 crore (marginally higher by 4.6% over 2019 budget) has been earmarked for the education sector in 2020-21 and Rs.3000 crore for Skill Development. “By 2030, India is set to have the largest working age population in the world. Not only do they need literacy but they need both job and life skills”, Finance Minister, Nirmala Sitharaman, said while presenting the Budget for the financial year 2020-21 in the Parliament on February 1.

She also stated that steps will be taken to enable sourcing External Commercial Borrowings and FDI to ensure greater inflow of finance to attract talented teachers, innovate and build better labs.

Degree level full-fledged online education programme will be started to provide quality education to students of deprived sections of the society as well as those who do not have access to higher education. However, these shall be offered only by institutions who are ranked within top 100 in the National Institutional Ranking Framework.

The Finance Minister observed that India should be a preferred destination for higher education. Therefore, under its “Study in India” programme, an Ind-SAT is proposed to be held in Asian and African countries for benchmarking foreign candidates who receive scholarships for studying in Indian higher education centres.

The finance minister announced that about 150 Higher Educational Institutions will start apprenticeship embedded degree/diploma courses by March 2020-21. This will help to improve the employability of students in the general stream (vis-a-vis services or technology stream). The government will also start a program whereby urban local bodies across the country would provide internship opportunities to fresh engineers for a period of up to one year. National Skill Development Agency will give special thrust to infrastructure-focused skill development opportunities, the Minister explained.

In order to meet the requirement of qualified medical doctors, it is proposed to attach a medical college to an existing district hospital in PPP mode. Viability gap funding will be made available to the States that fully allow the facilities of the hospital to the medical college and provide land at a concession.

The Government will also encourage large hospitals with sufficient capacity to offer resident doctors DNB/FNB courses under the National Board of Examinations. Smt Nirmala Sitharaman stated that a huge demand exists for teachers/nurses/para medical staff and care givers abroad. Therefore special bridge courses may be designed jointly by the Ministries of Health and Skill Development along with professional bodies to match the employer’s standards as well as meet the language requirements of various countries.

A National Police University and a National Forensic Science University have also been proposed in the domain of policing science, forensic science, cyber-forensics etc. in the Budget.

The Finance Minister, in her speech also said that the New Education Policy will be announced soon.

Reactions as these pour in:

“There was too little for the education sector in the budget. FM did not reduce any GST cut yet. FM did emphasize on education ion and employability but no clarity on how it will achieve employability. But the fact that it was on mind is good but we need to see details on how well the funds get deployed. Development of online courses was good but that would be limited to only top 100 institutes. (Budget) should have focused more on the boost to online courses and infra to help smaller niche institutes to also enable online courses. Also, didn’t mention anything about the education abroad or loans. But again I feel the bigger problem has been the quality of institutes and research levels. Nothing has been said about that. 150 higher education institutions to start apprenticeship programs is a good sign but again too little. Need something on mass levels. One thing I would have liked is how foreign-educated graduates could be attracted back to build India.” –  Sumeet Jain, Co-founder, Yocket, an Edtech startup

”A marginal 5% increase compared to previous budget is welcoming but not enthusiastic. Big announcements around much-required digital reformations at government schools and colleges which caters to 70% of India’s student base is missing. An expectation around financial exemptions and tax cuts for Ed-Tech companies, which is a key component of Education sector, have not been met with. Providing Online Degree Programs to the students with poorer accessibility seem like the only significant step-up towards Digital Education in this budget. A 3000 Crore budget for skill development especially announcement of the bridge courses to upskill Health Care Professionals is a positive move. We look forward detailed-out plans for education sector in the upcoming New Education Policy.”  –  Ashutosh Kumar, Co-Founder and CEO of Testbook 

“A National Forensic institute being proposed by the FM will give impetus to forensic science in the country and hopefully put in place a universal framework and metholodgy to conduct forensic and cyber reviews that will become the benchmark for all investigations in country. This initiative will also attract students towards Forensic science as a career option.” – Nikhil Bedi, Partner, Deloitte India 

“The increase in the education budget in FY20 indicates the Government’s support in creating a skilled and educated India. I am also personally looking forward to Arts (Music) playing an important role in our education sector and if supported and energised through government initiatives, it will really help. Globally we have witnessed how music has helped in the overall development of the nation and individual growth. It has also been linked to increase in entrepreneurs in all these nations.” Tanuja Gomes, Co – Founder & Co – CEO, Furtados School of Music

“While we look forward to the implementation of the New Education Policy as announced by the Finance Minister, it is nice to see proposals aimed at the creation of a more inclusive education system – the outcomes have to be tangible, and the regulatory system needs to be revamped. India has one of the world’s largest working population, and the allocation of Rs 3000 crore for core skill development should be part of an agile higher education system for long-term relevance. Further the focus on enabling the teaching community is well appreciated – we should be able to attract the best minds to the noblest profession! I am personally very excited about the 8,000-crore allocation for the National Mission on Quantum Technology. We are looking forward to more details and a sound implementation plan.” –  Dr Rupamanjari Ghosh, Vice- Chancellor, Shiv Nadar University

“Government has raised curiosity with the announcement to introduce the New Education Policy soon. FM seems to be hinting at keeping all options open when she stated ‘External Commercial Borrowings & FDI shall be tapped to ensure delivery of Quality Higher Education’. Taking forward last year’s emphasis on skill-training, FM has proposed to introduce Apprenticeship programmes among 150+ higher education institutes by March 2021. In addition, she has hinted at Urban Local Bodies providing internship opportunities to fresh engineers. This is a welcome step towards greater collaboration between Industry & Academia.” – Nilesh Gaikwad , Country Manager, EDHEC Business School

“It is a progressive budget that acknowledges the role technology can play in addressing challenges and improving access to quality higher education and employment opportunities for India’s youth. Government’s announcements related to the development of emerging technologies like AI, ML, Data Analytics ecosystem in the country and skilling opportunities for the youth, clearly reflect the focus on preparing the youth for jobs of tomorrow. Also, the introduction of online degree programs highlights the growing acceptance of online education in its capability. Aided with a boost in infrastructure and high quality content, online education will not only accelerate skill development initiatives but also help ‘right-skill’ the workforce of the futureWe anticipate that the announcement to improve the online education ecosystem will facilitate greater collaboration between educational institutions and online education platforms.”-Raghav Gupta, Managing Director, India, and APAC, Coursera

 “Union budget 2020 is definitely a step towards boosting India’s economic growth. The boost to entrepreneurship, startups and skill development in the infrastructure sector is a welcome move that will help create jobs directly. A total of Rs 3000 crore has been allocated for skill development, which shows the government’s commitment towards encouraging employment growth rate and boosting the skill sector. The move to introduce a common eligibility test for recruitment for non-gazetted government posts will also witness a further push in employment opportunities in the government sector.

The finance minister has encouraged the spirit of sharing economy and new technology like 3D printing, AI, IoT and ML, which will uplift the sentiments of the youth to further innovate and push India’s economic growth.” – Nilabh Kapoor, Business Head India, OLX People

“The FDI part was in waiting for a long time, glad to have it come through – it will really help us make a big leap! Online education programs, introduction of new courses that will push students into careers of tomorrow, and of course ‘the Indian SAT’ for promoting #StudyInIndia – all are in the right direction, and I am personally very excited about us at Leverage Edu helping execute some of these parts” – Akshay Chaturvedi, Founder & CEO, Leverage Edu  

‘I welcome the Government’s initiative to open Data Center Parks across the country as the finance minister has rightly said that ‘Data is the New Oil’. This will lead to the digitisation of the rural areas while providing various employment opportunities to the people across the country. Also, I would appreciate the use of AI & ML by the government in Aayushman Bharat Scheme to improve the healthcare services and eradicate tuberculosis in India by 2025.” – Kunal Jain, Founder & CEO, Analytics Vidhya 

In order to reach the target of average spend of USD 173 billion a year to achieve the SDG 4 by 2030, it would be an unrealistic expectation to see that coming solely from government and pure philanthropic initiatives. In this context, we welcome the Government’s steps towards encouraging sourcing External Commercial Borrowings and FDI to boost quality education. We hope this would pave the way for opening up and formalising the sector and ensuring long term responsible and patient capital, giving the much needed confidence to potential investors to invest in the sector and expect legitimate RoI as spoken about several times in the past.” – Manit Jain, Chairman, FICCI ARISE; Co-founder and Director The Heritage Group of Schools

The Finance Minister has promised in the budget speech that the New Education Policy will be announced soon. The current policy is several decades old and the new policy is expected to introduce fresh ideas, particularly on the use of technology, modern teaching pedagogies and experiential learning. The proposal to allow FDI in education sector does not worry us as IIMs have always benchmarked themselves against global standards of teaching and learning. However we need to wait for the full details of this policy to see whether it would mean global schools and colleges opening campuses in India or simply foreign capital getting invested in Indian private institutions. I am happy that the budget has proposed online educational programmes as the time has come to leverage technology to provide “value for many” instead of just “value for money”- Prof. Debashis Chatterjee, Director, IIM Kozhikode

“We welcome the focus on education, skill development and new-age technologies in this year’s budget which focuses on furthering the employability of Indians through the government’s Skill India Mission launched in 2015. The step by the government to facilitate the educational needs of the growing working-age population and students who do not have access to higher education by offering online education programs from the top 100 institutions of the country is commendable. It will allow students from around the country to have quality education and learn from the best institutions in the country.

Optical Fibre program, connecting 100,000 Gram Panchayats in FY21 will provide a great opportunity for students to learn new skills online at affordable rates. Also, the upcoming policy to set up data centre parks throughout the country will provide more jobs for the youth. The attempt to address the huge demand of teachers, nurses, paramedical staff and caregivers abroad by focusing on skill-development is also good and it will create more job opportunities.” – Irwin Anand, MD, Udemy India

“As higher education evolves in line with technology, formal education is increasingly replaced by specialised on line programs. Allowing top 100 NIRF ranked institutes to award on line degree is a step in the right direction to bestow students with skills and formal degree without the need to be on campus physically. Our institutions are woefully poor in infrastructure and the government’s ability to invest for modern infrastructure has been crippled mainly due to heavily subsidised centrally run institutions. Therefore, it is logical and welcome move that this budget proposes FDI and ECB would help accelerate investments and aid research and better academic delivery.”P. N. Hariharan CFO, ITM Group of Institutions 

“The Finance Ministry’s focus on skill development will enable job creation which will compel more students to upskill. The proposed online education programme to provide quality education to students is a reformist step. This will help in gathering on job experience and further employment. Initiatives such as ‘Study in India’ and ‘Skill India Mission’ will be instrumental in increasing the quality of education in India. Additionally the reduction in the limit for NBFCs eligibility for debt recovery under the SARFAESI Act 2002 will be a tailwind for the sector’- Amit Gainda, Chief Executive Officer, Avanse Financial Services

“Budget 2020 is hugely positive for the country’ education sector as its focusing on most of the important parameters of this sector. “Study In India” project is also going to establish India as a major education Hub which will surely open new avenues for education industry. Another measure taken by the government to make education more technology friendly & accessible is to include its provision for Degree level online learning programme will make higher education more accessible & of more quality which will result in securing a better career. 

The remarkable investment, along with the introduction of the Ind SAT, and rollout of online education for Higher education makes this budget very friendly to the education sector. Also with the announcement of new education policy launch we are very hopeful & positive towards the industry growth.”-  Kiran Dham CEO & HR Head , Globus Infocom 

” Allowing foreign investments and external corporate borrowings by educational institutions will provide much needed new funding sources to facilitate their growth. Further, offering full degree programmes online will enable those who cannot access regular colleges to avail the qualifications they need to gain full employment. As education is a state subject, it is good to see that the central government is coordinating with each state to encourage the implementation of the New Education Policy at the grassroots. Additionally, new technologies are often the drivers of economic growth of nations. Encouraging student engineers to get internships in local bodies will help in equipping them with real-world job skills required to work with, and develop these new technologies to help our country join the ranks of other developed nations.” – Dr. Akhil Shahani, Managing Director, The Shahani Group

“We are encouraged to hear the government talk about FDI in education in today’s Budget. Openness to receiving, and capitalising upon, the transfer of knowledge as well as education management know-how that top institutions around the world are actively looking to make to greener pastures like India, is a no-brainer in my opinion. Foreign collaborations in higher education – with or without FDI – offer a near term solution to the problem of quality human capital and employability, which can help us avert a demographic disaster and reap some dividend instead. That is why we at ISBF welcome this announcement, which will also help operationalise the government’s dream of making India an international hub for higher education.”- Dr Jitin Chadha , Founder & Director, Indian School of Business & Finance (ISBF) 

“Budget 2020 truly sharpens the country’s focus on becoming the next global hub for education. Significant announcements like the introduction of FDI in the education sector, launch of ‘Study in India’ programme, new apprenticeship programmes and online degree courses, besides the continued budget allocation for skill development, reiterate the government’s commitment towards the youth of our country. I am confident that these strategic initiatives will play a decisive role in the building of a New Digital India.” – Dr. Sanjay Gupta, VC of World University of Design.

 “The proposed IND-SAT test for foreign students  and emphasis on External Commercial Borrowing & FDI for education sector are commendable steps by the govt to promote ‘Study in India’ initiative and making India an education hub. This budget has also taken care of the biggest challenge in the education sector i.e. achieving higher literacy and employment through the announcement of full-fledged online degree programs for under-privileged students and building up of 150 higher education institutions to offer apprenticeship diplomas. The announcement of new education policy will further standardize the education system in the country.” –  Monica Malhotra Kandhari, MD, MBD group

“Apprenticeship programs, which will be started in about 150 higher education institutions, augmented by internship programs with urban local bodies, up to a period of one year will help train students more comprehensively and shall ensure that most of the working class population is employed by 2030. Implementing the Ind-SAT exam for Asian and African countries will make India a hub for higher education, thus attracting global talent. The suggested proposals will certainly help India shine globally. We welcome these proposals and are hopeful for a great education scenario in the country.”- Akshay Munjal, President, BML Munjal University 

“We are encouraged to see the government’s commitment towards ensuring quality education in India. While this year’s budget was mainly focused on higher education, we are hopeful that the yet to be announced education policy will put the spotlight on primary education, crucial to the formative years of students. For the government to achieve its vision of an India where all children get an excellent education it will be crucial to incentivize states to improving learning outcomes of students and invest in leadership for education.”- Shaheen Mistri- Founder & CEO, Teach For India

 “The Union Budget 2020 recognises the potential of online education and skill-development in enhancing employability. The government has tried to strike an equilibrium between the needs of the public sector and generating employment through the right skill sets, like engineers interning at urban local bodies and the announcement of a National Forensic & National Police University. Furthermore the focus on skill-development in museology and archaeology is expected to fuel the tourism sector with the right talent in the coming years.

The government has clearly highlighted that technology will drive the next wave of growth, with the provision of INR 8,000 crore for the National Mission on Quantum Computing and Technology and announcement of 2 national level science schemes. The Fibre to Home initiative will link 100,000 Gram Panchayats through BharatNet in FY21, ensuring internet penetration in rural areas and expanding the ambit of online education in the country.”Ramananda SG, Vice-President, Sales and Marketing, Pearson India 

“Addressing the severe skill shortage that businesses across India are facing at present, focus on skill development will lead to progress in the nation. We are also very affirmative with regard to the new education policy that will ensure quality education to students. Also, the introduction of degree-level full-fledged online education will empower the disadvantaged sections of the society in acquiring employable skills and for upskilling.” Nikhil Barshikar, Founder and Managing Director, Imarticus Learning


“The Union Budget 2020-21 clearly focusses on education and skill development through outlining a series of progressive steps in this direction. The proposals of internships in local bodies for engineering students and facility online education for the deprived section are in line with the goal of Skill India. Moreover, the announcement of a full-fledged online education programme by educational institutions will complement conventional education and ensure greater equity in access to education. The proposals of the Union Budget along with the proposed New Education Policy will go a long way in boosting the education sector in the country.” – Rohit Manglik, CEO, EduGorilla

Budget2020 will help position India as a global educational hub. We appreciate the launch of the ‘Study in India’ programme which will enable foreign students to apply for scholarships to study in India. Overall, we believe that this renewed push on providing quality education and enhancing the skills of our youth, will help India play a lead role in shaping the global economy in the future.” –  P K Gupta, Chancellor, Sharda University

“The Finance Minister has set out an ambitious plan to create more job opportunities by identifying skill development programs, providing internship opportunities in urban bodies while also opening the education system to FDI and ECB.”- Shalini Pillay, Office Managing Partner, Bengaluru, KPMG in India