Union Budget 2025: Management Institutions respond to Allocation for IIMs and Educational Reforms

As industry experts analyze the implications of these budgetary decisions, let us delve into their reactions and insights into the Union Budget 2025.

Union Budget 2025, presented by Finance Minister Nirmala Sitharaman, has garnered a variety of reactions from the management education sector, particularly with regard to the increased allocation for the Indian Institutes of Management (IIMs). A key highlight of the budget was the government's decision to allocate ₹ 251.89 crore to IIMs, up from ₹ 212.21 crore in the previous year. Additionally, IIMs’ Gross Budgetary Support (GBS) has risen to ₹ 30 crore, compared to ₹ 12 crore last year. Meanwhile, the interest under the HEFA Loan has also gone up to ₹ 72 crore. This was ₹ 60 crore in the year 2024-25. Also, one of the notable aspects of Union Budget 2025 for IIMs has been allocated for Interest under HEFA Loan and Repayment of the Principal of the HEFA Loan, i.e. ₹ 149.89 Crore.

Union Budget 2025: Support to Indian Institutes of Management (IIMs)

Expenditure Head	2025-26 Allocation (INR Crore)
Support from Gross Budgetary Support (GBS)	30
Interest under the HEFA Loan	72
Repayment of Principal of HEFA Loan	149.89
Total- Support to Indian Institutes of Management (IIMs)	251.89

 A Visionary Approach to Higher Education: Professor Mahadeo Jaiswal’s Take

Professor Mahadeo Jaiswal, Director of IIM Sambalpur, praised the government's comprehensive approach to education and innovation, particularly in the realms of AI and skill development. "The budget is visionary in enhancing India's higher education, women empowerment, and entrepreneurship," he said. "The ₹500 crore allocation for AI Centres of Excellence and the establishment of 50,000 Atal Tinkering Labs reflect the government's commitment to building a workforce equipped to meet the demands of a rapidly evolving global economy."

A Boost for Skilling and Entrepreneurship: Dr. Subir Verma's Insight

Dr. Subir Verma, Director of FORE School of Management, noted that the Union Budget’s emphasis on skilling and entrepreneurship is a significant step forward. "The proposal to establish five National Centres of Excellence for Skilling will empower our youth to compete on the global stage," he said. He also welcomed the government's decision to remove TCS (Tax Collected at Source) on education remittances funded through loans. "This move will reduce financial burdens for students pursuing higher education abroad and make global education more accessible."

Dr. Verma also highlighted the expansion of India's skilling partnerships, positioning the country as a future hub for global talent. "This budget's focus on creating a world-class workforce is a step toward making India a leader in innovation," he added.

AI and Education: Radhika Shrivastava's Take on Future of Business Education

Radhika Shrivastava, Executive Director at Fortune Institute of International Business, emphasized the long-term impact of the budget on business education in India. "The creation of Centres of Excellence in AI, alongside increased investments in IIT infrastructure, will enhance India's education landscape. These measures will provide students with access to cutting-edge learning environments, preparing them to thrive in the evolving business ecosystem," she remarked.

Transformative Reforms for Inclusive Growth: Dr. Prabina Rajib’s Perspective

Dr. Prabina Rajib, Director of BIMTECH, applauded the transformative reforms outlined in the Union Budget, particularly in the domains of AI and entrepreneurship. "The Rs 500 crore investment in AI Centres of Excellence will advance research and innovation. The focus on small and medium-sized enterprises, alongside measures to boost credit availability, will support India’s startup ecosystem," she stated. Dr. Rajib also highlighted the increased funding for educational infrastructure, which she believes will strengthen India’s competitive edge on the global stage.

Skill Development in Healthcare: Dr. PR Sodani’s Analysis

Dr. PR Sodani, President of IIHMR University, noted that the budget’s focus on skilling aligns with the growing demand for specialized professionals in India’s healthcare sector. "The establishment of Centres of Excellence for AI in Education is particularly significant for healthcare management professionals," he said. Dr. Sodani added that initiatives like the New Fund of Funds, which expands financial support for startups, would reshape India’s entrepreneurial landscape and drive employment.

IIM Raipur: Professor Ram Kumar Kakani on Growth and Inclusivity

Professor Ram Kumar Kakani, Director of IIM Raipur, highlighted the budget’s role in fostering inclusivity and entrepreneurship. "The establishment of a ₹10,000 crore fund-of-funds for startups and a scheme empowering SC/ST women entrepreneurs will empower marginalized communities," he said. Professor Kakani emphasized that such initiatives, coupled with expanded lending ceilings for education, would create a robust foundation for a future-ready workforce. "This is a blueprint for a self-reliant, inclusive India by 2047," he concluded.

Professor Himanshu Rai, Director, IIM Indore take on Union Budget 2025

Lauding the budget allocation 2025, Professor Himanshu Rai, Director, IIM Indore said, “The Union Budget 2025-26 is the making of an India F.I.T. – Future-ready, Innovative, and Tech-driven. More than a finance roadmap, this is a vision for a resilient and progressive economy.

Taxpayers breathe easy with a higher exemption slab, which would mean more disposable income and greater consumer spending. But beyond the tax cuts lies the real thrust: future-ready India, one that works on digital innovation, robust infrastructure, and inclusive growth. Investments in AI, semiconductors, and digital skilling will prepare the youth for the jobs of tomorrow, while MSME support and startup funding will fuel entrepreneurship.

Infrastructure is a backbone, with the thrust on better logistics, urban transformation, and high-speed connectivity for seamless economic integration. Sustainability is also to the fore, with clean energy, EV incentives, and green hydrogen initiatives ensuring that India's growth is always aligned with environmental responsibility. Ultimately, it is a F.I.T. India, full of financial stability, innovation, and technology-driven development.”

A Modest but Necessary Increase: Professor Prateek Bedi’s Concern

Professor Prateek Bedi, Assistant Professor of Finance and Accounting at IMI New Delhi, while acknowledging the budget’s positive direction, expressed concerns about the modest increase in funding for higher education. "A ₹2,458.95 crore increase for higher education is welcome but not sufficient to meet the rapidly growing needs of the sector, especially in digital learning infrastructure and research funding," he said. Professor Bedi also stressed the importance of strengthening collaborations between industry and academia to create meaningful employment opportunities for graduates.

A Mixed Yet Optimistic Outlook

While reactions to the Union Budget 2025 remain mixed, experts from various management institutions agree that the government’s focus on education, skill development, and entrepreneurship will significantly benefit India’s future workforce. However, there is also a consensus that more aggressive investment in digital learning, higher education research, and industry partnerships is required to fully realize the potential of the country’s educational landscape. As India moves towards its goal of becoming a ‘Viksit Bharat’ by 2047, the budget lays a strong foundation for the next generation of leaders, innovators, and entrepreneurs. The government has allocated ₹1.28 lakh crore for the education sector in Union Budget 2025. The total allocation for school education increased from ₹73,008 crore in 2024-25 to ₹78,572.10 crore in 2025-26, marking a rise of ₹5,564.10 crore, while higher education saw a modest increase from ₹47,619 crore to ₹50,077.95 crores, an uptick of ₹2,458.95 crore.

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