The Hon’ble Finance Minister of India (FM), Smt. Nirmala Sitharaman, presented the Union Budget for the fiscal year 2023-24 on February 1. The education budget was allocated Rs 1.12 lakh crore, the highest-ever allocation to date. This brings clear hope for job creation, growth and development that will take place in the education sector in the coming months.
Of this 1.12 lakh crore, INR 68,804 crore has been allocated for school education and literacy, and INR 44,094 crore for Higher Education (both up nearly 8% over the 2022 budget). The expenditure on education remained at 2.9% of GDP in 2023.
Announcing the budget, the finance minister emphasised some key points that can benefit the growth of the education/edtech sector. The launch of “Pradhan Mantri Kaushal Vikas Yojana 4.0” (PMKVY) to skill lakhs of youth in new-age courses, among other skilling and education-focused programmes, has been discussed in the budget. Different segments like setting up Centers of Excellence for Artificial Intelligence in top educational institutions, 100 laboratories in Engineering Institutions for developing applications using 5G services, and a National Digital Library for children and adolescents for facilitating the availability of quality books across geographies, languages and genres were also announced.
For education, the new budget clearly focuses on bridging the skills gap and keeping up with the changing skill demand in the international market. The budget also aims to support the K12 education in T2 cities and beyond.
The increased telecom budget will also have an indirect impact on education. As the telecom operators move to offer 5G services across India, the increased funding will undoubtedly contribute to improved educational opportunities, especially in the T2 cities and beyond, through better connectivity and access. The budget also has a dedicated telco fund for the North-Eastern states.
The EdTech sector has faced several challenges like layoffs, funding winter, valuations being cut down, IPOs being delayed, etc. Still, founders and investors have come together for sustainable growth in this economic slowdown, and the 23-24 budget also brings hope and support.
The union budget also comes with Income Tax benefits for startups. The startup eligibility based on the incorporation date has been extended till March 31, 2024. Further, the startups will now be able to carry forward part losses to 10 years (vs 7 years previously), and startups incorporated on or after April 1, 2016, can apply for income tax exemption.
Here are reactions from EdTech founders and stakeholders on how the Budget 2023 can impact the education/edtech sector.
Prateek Maheshwari, Co-founder of PhysicsWallah, said, “Overall, this budget is progressive as it accelerates the government’s efforts for inclusive and sustainable development, and we are pleased that the government has recognised the importance of a technology-driven and skill-enhanced economy. It provides a strong impetus for growth and job creation. The National Digital Library for children, initiated by the honourable Finance Minister Nirmala Sitharaman, is a testament to the government’s commitment to modernising and advancing the economy.”
He added, “As AI becomes increasingly integrated into our lives, the skill enhancement initiative recognises its significance as a necessary tool for future growth and success. As a helping hand to the government to make up for the learning loss during the pandemic, we are donating accessible high-yield competitive Test Prep MCQs along with solutions across all the categories, Videos, and Books for the learners, to the National Digital Library.”
Prateek feels that an “ed-tech commitment” was one area where the budget lacked his expectations.
It seems that some of the “budget expectations” from Mohan Lakhamraju, Founder and CEO of Great Learning, like “Lowering GST for reskilling & upskilling & Incentivising professionals who advance their skills through a tax deduction”, remained unmet.
Divya Gokulnath, Co-founder of BYJU’S, said, “With the launch of PM Schools for Rising India, the recruitment of 38,800 teachers, and the establishment of a National Digital Library for children, the education sector is a key area of investment. These initiatives will help equip students with the skills and knowledge needed for success in the future, and the emphasis on teacher training and innovative pedagogy will ensure that the quality of education in India continues to improve.”
Akshay Munjal, Founder & CEO of Hero Vired, also believes, “The government has taken a series of proactive steps for the education sector. While the education sector is supported by the National Education Policy (NEP), the Pradhan Mantri Kaushal Vikas Yojana 4.0 will further catalyse growth through upskilling the workforce. Additionally, with the focus on skilling and reskilling, edtech players will get more opportunities to form industry alliances to bolster the sector and provide the right tools to learn. The initiatives like ‘Unified Skill India Digital Platform’ and ‘Make AI in India’ will promote India’s startups and the entrepreneurial spirit and encourage youth to boost their knowledge through various skilling and reskilling programmes. Bolstered by these initiatives, India has the potential to create a technology-driven and knowledge-based society in the coming future.”
Pratham Mittal, Founder of Masters’ Union, said, “The Union Budget 2023 gets many things right! It is focused on growth, and I am glad that job creation and youth upliftment get priority. The push for digital upskilling and entrepreneurship enhancement will encourage an entrepreneurial culture and increase India’s visibility internationally. While there’s a focus on bridging the industry-academia gap, the budget could’ve done more on infusing some much-needed innovation in how education is imparted in our country.”
Additionally, the National Education Policy 2020 has emphasised the use of technology in multiple ways to enhance the teaching-learning experience and make quality education accessible to the masses. NEP has made a significant mark in the budget session. The FM stated that the education budget needs to be at least 6% of the total GDP. Many developing nations even invest as much as 15% of their total GDP in education.
Giving preference to Eklavya Model in her speech, the hon’ble FM said that the centre would recruit 38,800 teachers and support staff for the 740 Eklavya Model Residential Schools, which are serving 3.5 lakh tribal students.
Anish Srikrishna, CEO of TimesPro, said, “The budget has ushered a slew of initiatives by emphasising the National Education Policy’s skilling outlook. We welcome the move and expect public-private cooperation to meet the goals of this initiative, accelerating India’s transition to an Industry 4.0 economy. The three AI centres of excellence to enable ‘Make AI for India’ and ‘Make AI work for India’ will benefit the development of digital infrastructure and skills in India. At a time when skilling and reskilling are critical for India’s youth, the government’s recognition of the need for skilling is an encouraging move for the Higher Education sectors. However, we continue to believe that lowering the GST on professional learning programmes would have made modern learning more accessible and affordable, assisting millions of learners in becoming future-ready.”
Nikhil Barshikar, Founder & MD of Imarticus Learning, said, “We are pleased with the way Union Budget 2023 has focused on leveraging technology to drive deeper penetration into the market and breaking barriers to provide access to top-quality education to the masses. We expect EdTech businesses catering to Tier-II and lower cities to gain significant momentum in the coming years. The government also announced setting up 30 skill India international centres across states; this will play a key role in the growth of employment opportunities for the youth of India. This provides significant tailwinds to opportunities in the technology upskilling space.”
Sumeet Mehta, Co-founder & CEO of LEAD, said, “The first Amrit Kaal Budget’s focus on “quality of education for all” is progressive and encouraging. I welcome the focus on teacher training and upskilling students with Industry 4.0 skills. However, while initiatives such as a National Digital Library and support for Eklavya Model Residential Schools are steps in the right direction to address the massive learning loss from the pandemic, well-designed PPPs are the need of the hour to create innovation at scale for millions of school going students in India. This will make high-quality learning more accessible and affordable, especially for students in small towns who lack resources, and will result in a long-lasting impact at scale. GST rebates on printing of books, assessment material and educational hardware can further enable affordability and access to high-quality, multimodal education in schools. Going forward, I look forward to policy support in this direction.”
Raghav Gupta, MD – India and APAC of Coursera, reacted on the Union Budget 2023, saying, “We welcome the Union Budget’s focus on providing critical skills to India’s youth. The revamped Pradhan Mantri Kaushal Vikas Yojana is a step in the right direction as it aims to impart new-age skills such as AI, robotics and 3D printing, offering young Indians a wide range of career opportunities globally. This focus will be crucial in helping India stay competitive in the fast-changing technology landscape.”
Atulya Kaushik, Co-founder & CEO of PrepInsta, said, “The Budget seems to give more push to employability readiness in youths. Direct Benefit Transfer under a pan-India National Apprenticeship Scheme, which will impact 47 lakh youths, seems promising. Setting up 100 Labs in engineering institutions will help graduates be ready to build applications on India’s 5G stack. Focus on smart classrooms will also help us take advantage of the metaverse and immersive learning. Overall, it should help India to release its demographic dividend for inclusive development. We applaud the government’s decision to establish a National Digital Library for Children and Adolescence to facilitate access to high-quality books on any device. The finance minister’s decision to expand Eklavya model schools for tribal students is another step forward in promoting digital literacy. Furthermore, by proposing 30 Skill India International centres across various states, surely, this year’s budget clearly emphasises the importance of closing the skill gap in youth across India.”
RCM Reddy, MD & CEO of Schoolnet India Ltd., also shared his views. “The government’s enhanced focus on increasing education access in rural India in this year’s Union Budget is a welcome move and will have a positive impact on the country’s literacy rate. It is also reassuring to see that teachers’ training has been given prominence; we look forward to witnessing its effective implementation in the year. This will help improve the quality of teaching and lead to better opportunities for students. What is also motivating is the announcement of the National Digital Library, which will encourage youth from diverse contexts to learn in a comprehensive manner. The National Education Policy, focusing on empowering the youth with futuristic skills, will work towards the holistic development of youth for a better tomorrow. We welcome the announcements and significant increase in allocations for the school education and skill development sectors, which are aligned with Schoolnet’s goal of providing equal access to world-class education to all learners, especially those in the middle and bottom of the economic pyramid.”
Shashank Pandey, Co-founder of ConveGenius, said, “Investing in AI is the way forward to make #Digital India a reality for all. Simple technologies like Conversational AI are changing the EdTech game by delivering the right information, data, and content to the right user at the right time.”
Raj Mruthyunjayappa, Chief Digital Officer and President – India of Anthology Inc., said, “The Union Budget can set new benchmarks in the field of education. The proposal to set up Centres of Excellence in Artificial Intelligence in educational institutions is a case in point. The plan to establish Skill India international centres across states for our youth to tap international opportunities is another novel move. Continued spending on skills through Pradhan Mantri Kaushal Vikas Yojna 4.0 is also a welcome move to continue the good work on skill programs over the next few years. It has increased allocation for school education by 8%. Overall, I believe India can become a torchbearer of new standards in global education. If we can provide innovative ways to enable better access to educational funds, that add impetus to our growing reputation as a highly-skilled workforce.”
Vibhuti Taneja, Education Consultant & Founder of EDcel Consulting, said, “Setting up three Centres of Excellence for artificial intelligence (AI) is a laudable move that will boost the adoption of AI in education. It will enable edtech players to bring more AI-driven innovation into the existing pedagogies and develop scalable solutions across industries. Simply put, the initiative will go a long way in making education more accessible and engaging for learners, helping them become tomorrow’s visionaries. Also, the industry looks forward to the initiatives announced under the teacher training drive with innovative pedagogy, curriculum transaction, ICT implementation and a continuous professional development survey and how this will further boost the education sector.”
Utsav Kheria, Co-founder of Rocket Learning, added, “We are thrilled to see that the first budget of the Amrit Kaal states foundational and early childhood education as a significant priority. The continuous capacity building combined with ICT focus allows for entirely new modes of teacher and caregiver upskilling in digital India, in which 95% of teachers have smartphone access. At Rocket Learning, we are excited to be a part of the civil society ecosystem, partnering with governments to help Anganwadi workers and primary school teachers and parents learn simple, experiential ways of stimulating children in the youngest early years.”
Sumeet Mathur, Country Head of ServiceNow India Development Center, said, “The Government’s focus on developing a technology and youth-led economy will play a pivotal role in further strengthening India’s position as the ‘Bright Star’ across the globe. Policies like Pradhan Mantri Kaushal Vikas Yojana 4.0 and National Education Policy are centred around encouraging industry participation to develop cutting-edge digital and soft skills amongst the youth. This initiative will help in job creation as well as in the creation of a future resilient workforce, empowered for purposeful work at the intersection of technology and people.”
Col. Gopal Karunakaran, Chief Executive Officer of Shiv Nadar School, said, “I welcome the launch of Pradhan Mantri Kaushal Vikas Yojana 4.0 in the 2023 budget. This scheme, which will focus on equipping the youth with cutting-edge skills in fields such as AI, robotics, and 3D printing, is a welcome step towards preparing our students for the demands of the 21st-century global marketplace. The emphasis on developing soft skills and launching 30 international centres will create numerous opportunities for our students to gain valuable experience and increase their competitiveness in the international arena. We look forward to seeing the positive impact of the different initiatives on our education system in the years to come.”
Rahul Attuluri, CEO and Co-founder at NxtWave, said, “We wholeheartedly welcome the Government’s initiatives announced in the Budget 2023-24. The re-envisioning of Teachers Training through integrated curriculum transaction, continuous professional development, dipstick service, ICT implementation, and the development of the district Institute of Education and Training as institutes of excellence are a great move towards augmenting the existing education ecosystem in the country. Also, the setting up of the National Digital Library for children and adolescents where quality books across geographies, languages, and levels and device-agnostic accessibility will be made available is a great initiative to make up for lost learning time students faced during the pandemic.”
Ashwin Ajila, Founder & Managing Director at iNurture, said, “The Union Budget 2023–24 outlines forward-thinking measures and reforms for the Indian education sector. The increased fund allocated to higher education is a promising development for the sector’s growth. These funds, aimed at advancing technology and digitalization, will expedite the implementation of the National Education Policy and also boost the upskilling of students across India, especially in tier 2, 3, and 4 cities. However, it is imperative to carefully oversee the deployment of these funds and enforce accountability for the impact and results produced.”
Alison Barrett MBE, Director India, British Council, said, “The Union Budget 2023 focuses on education and skilling as key growth drivers for inclusive development; this is being addressed not only through the deployment of R&D and tech but crucially through teacher recruitment and training, and increased access to books and material to all corners of the country through the National Digital Library. Foundational literacy and access to education provided through skilled teachers have been highlighted as a priority in the NEP 2020, for India to effectively prepare its growing young population for the future. We are confident that these developments will accelerate the implementation of the NEP 2020, and we remain committed to partnering with the government and education sector in India to enable young Indians.”
Akshay Marwah, Mohit Marwah, Co-founders, AAFT Online, said, “The honourable Finance Minister’s move to launch a unified Skill India digital platform to empower the youth and focus on job training through the formulation of the National Education Policy in the Budget 2023 is highly commendable. The focus on youth and the future of India by macroeconomic stability and a visionary focus on technology advancement and setting up AI centers in top education centres is a great step forward. The budget sets a hopeful tone for India’s GDP and economic growth with special emphasis on vocational, secondary, and specialized higher education, as India’s GDP is projected to grow at a rate of 6-6.8% in the 2023-24 fiscal year. The FM’s allocations is a practical approach in the 2023 budget which aims to boost the country’s economy with focus on Make in India, women and youth empowerment.”
Beas Dev Ralhan, CEO, Next Education said that “In its latest budget, the government is emphasising on job creation and training or uplifting the education standard. It further addresses the concern of vocational secondary education and specialized higher education. This sets a hope as our country’s GDP is likely to grow at a rate of 6-6.8 percent. For the 2022-23 financial year, the Eklavya Model Residential Schools (EMRS) budget has been increased by Rs 581.96 crore, from Rs 1418.04 crore in 201-22 to Rs. 2,000 crores. Under the scheme, tribal students will be able to attend residential schools. The budget also promotes the quick implementation of the latest technological advancements in the academic field to build an ecosystem of skilled students. In order to upskill teachers, innovative pedagogies, curriculum transactions, a dipstick survey of continuous professional development and the implementation of ICT will be used. A reduction in the cost of capital for educational loans was hoped for and is to be commended. Inflation and the necessity to adapt to technology remain challenges for the digital education sector with regard to taxation.”
Anil Agarwal, CEO & Co-Founder InCruiter (IaaS Firm), said, “Economic agenda focuses on three things – facilitating ample opportunity for citizens, especially the youth, providing a strong impetus to growth and job creation and third stabilising the macro economy. Amid job cuts, this budget provides a beacon of hope and is seen as a means of boosting the economy. By emphasizing the use of innovative and advanced technology, the budget creates an environment that promotes specialized growth, encourages experimentation, and leaves room for entrepreneurial ideas. This, in turn, enables HR leaders to better address each employee’s strengths and weaknesses, support their professional development, and maintain their engagement in the workplace.”
Sourabh Deorah, CEO & Co-founder, Advantage Club, said, “Budget 2023 was presented with an impressive people-oriented agenda to address global challenges and strengthen the economy. It’s a well-balanced budget focusing on capital formation, green energy and R&D with an increased tax rebate for the middle class. New tax slabs announced by the government for the middle class are a big step in the right direction. Still, as the government has made the new tax regime a default regime, they should have carried deductions like 80c, HRA, and medical insurance premiums from the old regime to the new one. The other sector where the government has made a big announcement is for startups. The tax holiday extension and allowing the carryover of losses from 7 to 10 years and across the change of shareholding pattern is significant on the ground level. While the primary focus was on the core sectors – Agriculture, Infrastructure, Manufacturing & Transportation, entrepreneurs were assured of transparency and support.”
Alagar Samy, Director, Consortium for Technical Education (CTE), said, “In the budget, Economic agenda for our vision focuses on facilitating opportunities for citizens, providing strong impetus to growth and job creation and strengthening macroeconomic stability. A total of 100 labs will be set up in engineering institutions with various authorities, regulators, banks and other businesses for developing applications using 5G services. The budget for self-directed online/offline training programs will enhance job seekers’ soft and digital skills, thereby improving their employment prospects. PM Kaushal Vikaas Yoajna 4.0 launch is a positive move to skill the Indian youth in new age courses for industry 4.0 such as robotics, coding, drones, and other soft skills. The budget focuses on improving education quality, strengthening teacher competencies, developing robust infrastructure, promoting skill development, and increasing access to affordable internet services. Prior initiatives like Career Skills and Samagra Shiksha’s online teacher training, focus on research and innovation, e-learning and student financial aid are expected to enhance India’s education system and bridge the gap between education and industry, producing a globally competent workforce. Education moves forward with industry partnerships, data governance policies, and a technology-focused approach with a special emphasis on AI applications.”
Dhuwarakha Sriram, Chief of Generation Unlimited (YuWaah) and Youth Development and Partnerships at UNICEF, said, “We are glad that the priorities in the Union Budget 2023 feature Youth Power. The introduction of the National Digital Library for children and adolescents, provisions for teacher training, on-the-job skill training, apprenticeships, and the creation of 30 Skill India International Centres will help promote access to knowledge. The government’s recognition of the post-pandemic learning loss is a welcome move. Emphasis on skill development with AR/VR applications will help young people prepare for the future of work and enable them with relevant soft skills. The digital and physical infrastructure, particularly for the most marginalised young people in the hinterland, will help build higher student engagement and interest and make learning an easy process.”
Prateek Gujral, Principal Advisor – South Asia, Augustana University, South Dakota, US, also believes that the comprehensive budget for 2023-2024 seems to be taking care of everything, viz, inclusive growth, education, youth and skilling, infrastructure, making more entrepreneurship, etc. Besides, it is heartening to know that all taxpayers will be paying lesser now. For inclusive education, the government has astutely put forward initiatives like recruiting teachers for 740 Eklavya Model Residential Schools, revamping teachers’ training via District Institutes of Education and Training, and Digital Library for children.
With India growing steadily, the FM also pointed out that India is now the third-largest startup ecosystem globally. Aligning with the global skill focus on AI-ML, robotics, 3D printing, and more, the budget aims to prepare India for international competition in the future jobs marketplace.
In conclusion, all are welcoming the new budget with a prime focus on education, training & skilling-reskilling-upskilling, 21st-century job readiness, and entrepreneurship.