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. The same was slashed in the interim budget presented by the government.

The IIMs, counted among the noted business schools in the country, have faced a cut in the budget for the second year in a row. Last year, the budget for IIMs was slashed from Rs 608.23 crore (RE) to Rs 300 crore. This year it has been further reduced to Rs 212 crore from the revised estimate of Rs 331 crore.

The budget for Indian Institutes of Technology (IITs) has also seen a marginal dip from the RE last year. The grant to the top technology institutions has dropped from RE of Rs 10,384.21 crore to Rs 10,324.50.

However, the support grant for central universities has increased by over 28 per cent. The budget for central universities has been increased to Rs 15,472 crore from RE of Rs 12,000.08 crore.

In school education, Kendriya Vidyalayas, Navodaya Vidyalayas, NCERT, PM Shri schools and grants-in aid to state governments and governments of Union territories have seen a rise in the budget allocation.

Upgrading 1,000 Industrial Training Institutes (ITIs) in hub and spoke model, aligning course content with skill needs of industry and revision of model skill loan scheme, are among the measures announced by the finance minister for the skill development sector.

She said, "One thousand ITIs will be upgraded in hub and spoke model, course content and design will be aligned to the skill needs of industry and new courses will be introduced for emerging needs. I am happy to announce a new centrally sponsored scheme for skill development in which 20 lakh youth will be skilled over a period of five years." "The model skill loan scheme will be revised to facilitate loans up to Rs 7.5 lakh with a guarantee from government promoted fund...this measure is expected to help 25,000 students every year," Sitharaman added.

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