Education Funding and Employability Challenges in India

India’s education system faces challenges despite increased public and private expenditure. While the ideal public spending on education is set at 6% of GDP, current allocations fall short. As of 2024, public expenditure on education is approximately 3.5% of GDP. This gap marks the need for efficient use of resources to improve outcomes in both school and higher education.

Historical Context of Education Funding

Since the Kothari Commission in 1966, public spending on education has been a focus. The first National Policy on Education in 1968 aimed to enhance educational quality. Despite rising private expenditure, public funding has not kept pace. The decline in the ratio of public to private spending on education has raised concerns about equitable access and quality.

Current Budget Allocations

In the Union Budget 2024, Rs 1,25,638 crore was allocated for education. Of this, Rs 73,498 crore was designated for school education. The Samagra Shiksha Abhiyaan received Rs 37,010 crore. However, the allocation primarily addresses infrastructure and teacher salaries, leaving little for pedagogy and educational innovation.

School Education Challenges

The National Education Policy 2020 aims for universal education. However, challenges persist. The gross enrolment ratio at the secondary level stands at 66.5%, with a dropout ratio of 10.9%. Despite high enrolment rates, many students struggle with basic literacy. Approximately 25% of students aged 14-18 cannot read a standard II-level text fluently.

Higher Education and Employability Issues

India hosts over 70,000 higher education institutions. Yet, proportion of graduates lack employability. The Economic Survey for FY24 indicated that only 10% of engineering graduates are job-ready. The disconnect between academic qualifications and industry requirements exacerbates the unemployment crisis.

Initiatives for Skill Development

The PM Internship Scheme launched in December 2023 aims to enhance employability. This initiative plans to provide 1.25 lakh internships across various sectors. Additionally, the government has allocated funds to upgrade 1,000 Industrial Training Institutes. However, effective implementation remains crucial.

Reforms in Higher Education

The University Grants Commission (UGC) Draft Regulations 2025 aim to address faculty shortages and outdated curricula. Current vacancies in teaching positions are alarmingly high. Increased funding and policy reforms are essential for enhancing the quality of higher education. Financial support for students is also critical, with loans announced for higher education.

Future Directions

To improve educational outcomes, India must focus on public-private partnerships. Doubling the number of universities could enhance access to higher education. The need for innovative funding solutions and curriculum reforms is evident. Addressing these challenges will be vital for aligning education with job market demands.

Questions for UPSC –

1. Examine the impact of historical education policies on current public spending in India.
2. Discuss the challenges faced by the Indian education system in achieving universal literacy.
3. Critically discuss the role of internships in enhancing employability among graduates in India.
4. With suitable examples, analyse the relationship between higher education reforms and workforce readiness in India.

Answer Hints:

1. Examine the impact of historical education policies on current public spending in India.

1. The Kothari Commission (1966) recommended increasing public expenditure to 6% of GDP for educational improvement.
2. The first National Policy on Education (1968) aimed to enhance quality but public spending has not kept pace with private expenditure growth.
3. Current public expenditure on education stands at approximately 3.5% of GDP, reflecting a historical trend of underfunding.
4. Declining public to private spending ratios indicate inequities in access and quality over time.
5. Historical policies have set the foundation for current funding debates, emphasizing the need for efficient resource utilization.

2. Discuss the challenges faced by the Indian education system in achieving universal literacy.

1. The National Education Policy 2020 targets universal education, yet low enrolment and high dropout rates persist, with a secondary gross enrolment ratio of 66.5%.
2. Approximately 25% of 14-18-year-olds cannot read a standard II-level text fluently, indicating poor literacy levels.
3. Infrastructure challenges, including inadequate resources and facilities, hinder effective learning environments.
4. Teacher salaries consume a large portion of educational budgets, limiting funds for pedagogy and innovative teaching methods.
5. Socioeconomic factors and regional disparities further exacerbate access to quality education, affecting literacy rates.

3. Critically discuss the role of internships in enhancing employability among graduates in India.

1. The PM Internship Scheme aims to provide 1.25 lakh internships across various sectors, enhancing practical experience for students.
2. Internships bridge the gap between academic learning and industry skills, addressing employability issues brought into light in the Economic Survey for FY24.
3. Industry engagement through internships helps align educational outcomes with job market demands.
4. Despite initiatives, effective implementation remains crucial for maximizing the benefits of internships.
5. Internships can also improve students’ confidence and professional networks, further enhancing their employability prospects.

4. With suitable examples, analyse the relationship between higher education reforms and workforce readiness in India.

1. The UGC Draft Regulations 2025 aim to address faculty shortages and outdated curricula, impacting the quality of education and workforce readiness.
2. Higher education institutions must adapt curricula to meet industry requirements, as evidenced by the low employability rates among graduates.
3. Examples include the need for multi-disciplinary courses that cater to diverse job roles in evolving industries.
4. Financial support for students, such as loans for higher education, is essential to make education accessible and align with workforce needs.
5. Public-private partnerships could enhance infrastructure and training, improving overall workforce readiness in higher education sectors.