Financing for equity in primary and secondary education
1. Education resources to subnational governments
2. Education resources to schools
3. Education resources to students and families
4. Social policies and family support programmes
Introduction
In India, the 2009 Right to Education (RTE) Act mandates free and compulsory elementary education for all children aged 6 to 14, covering eight years of schooling with no tuition fees and additional support like scholarships, uniforms, and textbooks, while early childhood and secondary education are not legally guaranteed as free or compulsory.
The Ministry of Education operates through two departments: the Department of School Education and Literacy and the Department of Higher Education. The Central Government directs education funding to States and Union Territories (UTs) mainly through centrally sponsored schemes.
1. Education resources to subnational governments
The Central Government provides education funding to States and Union Territories (UTs) primarily through Centrally Sponsored Schemes (CSS). The majority of the Department of School Education and Literacy’s budget is dedicated to these schemes. Key programmes supported under this framework include Samagra Shiksha Abhiyan, PM Poshan, and PM Schools for Rising India (PM-SHRI) (PM-SHRI).
Funding allocations are determined through a combination of formula-based and performance-based mechanisms. Formula-based allocations consider structural factors such as student enrolment, which benefits larger states, and demographic indicators, including the proportion of Scheduled Castes, Scheduled Tribes, and other disadvantaged populations. Performance based grants to states include sector-specific grants recommended by 15th Finance Commission for school education to enhance school educational outcomes. Performance-based allocations consider educational effectiveness, learning outcomes, dropout rates, and infrastructure gaps. Geographic and administrative factors - such as school distribution, number of districts, and rural–urban composition - also influence the allocation of funds.
For Samagra Shiksha Abhiyan, the funding from the Centre and States varies by region: the Centre provides 90% and the States 10% for the eight North-Eastern states and three Himalayan states (Jammu & Kashmir, Himachal Pradesh, Uttarakhand); 60% from the Centre and 40% from the States for other States and Union Territories with legislatures; and full (100%) central funding for Union Territories without legislatures.
2. Education resources to schools
Under the Samagra Shiksha Abhiyan, targeted grants are provided to improve access and learning outcomes for disadvantaged groups. Grants for Educationally Backward Blocks, Tribal and Difficult Areas cover backward blocks, Left Wing Extremist (LWE) affected districts, Special Focus Districts, border areas, and aspirational districts, supporting the establishment of new Upper Primary, Secondary, and Senior Secondary Schools. The grant amounts are Rs. 10 lakh (approximately USD 12,050) per Upper Primary School, Rs. 25 lakh (approximately USD 30,125) per Secondary School, Rs. 40–70 lakh (approximately USD 48,200–84,350) per Senior Secondary School, and Rs. 15 lakh (approximately USD 18,075) annually for each additional subject stream.
Additionally, all government schools receive a Composite School Grant, with allocations linked to enrolment size and priority given to socio-economically disadvantaged areas. The annual grant under this component ranges from Rs. 25,000 to Rs. 1 lakh (approximately USD 300–1,205) per school.
The 2018 Samagra Shiksha subsumed the 2001 Sarva Shiksha Abhiyan, extending its bridging of social and gender gaps and provision of equity and inclusion. This built on and replaced some aspects of the 1994 District Primary Education Programme and the 1987 Operation Blackboard.
PM Schools for Rising India (PM-SHRI)
The PM Schools for Rising India (PM-SHRI) scheme targets 14,500 schools for comprehensive upgradation across defined parameters. Its seeks to embed the 2020 National Education Policy (NEP)’s guiding principles into practice, connect schools with local entrepreneurial ecosystems, and expand access to counselling and advanced technological infrastructure. As of 2025, 12,079 schools had been selected, comprising 1,329 primary, 3,340 elementary, 2,921 secondary, and 4,489 senior secondary institutions.
3. Education resources to students and families
Kendriya Vidyalaya Sangathan (KVS)
The Kendriya Vidyalaya Sangathan (KVS) manages a nationwide network of central government schools, with a strong emphasis on equity and inclusion for children from economically weaker and disadvantaged backgrounds.
Navodaya Vidyalaya Samiti (NVS)
Navodaya Vidyalaya Samiti (NVS) system selects talented rural children as the target group and provide them quality education comparable to the best in a residential school system, irrespective of their capacity to pay for it, and to enable to compete with their urban counterparts on an equal footing.
Samagra Shiksha Abhiyan – Direct Benefit Transfer
The Samagra Shiksha Abhiyan scheme channels resources and funding directly to students from pre-primary to Class XII, currently covering about 156 million learners. A Direct Benefit Transfer (DBT) system has been established to ensure the timely and transparent delivery of support such as uniforms, textbooks, and stipends for girls with special needs. These benefits are credited into beneficiaries’ bank accounts through the State and Union Territory Education Departments.
National Means-cum-Merit Scholarship Scheme
The National Means-cum-Merit Scholarship Scheme (NMMSS), launched in 2008, provides support to meritorious students from economically weaker households with parental income of up to Rs. 3.5 lakh per year (4,200 USD). Its main objective is to prevent dropouts after Class 8 and encourage students to continue their studies up to Class XII. The scheme provides 100,000 scholarships annually. Each scholarship is worth Rs. 12,000 (145 USD) per year, or Rs. 1,000 (12 USD) per month and is paid directly into students’ bank accounts via DBT. Scholarships are renewable based on academic performance and conduct. The scheme also incorporates State and Union Territory-based reservations, is valid only for studies within India, and covers a duration of four years.
4. Social policies and family support programmes
Pre-Matric Scholarships for Scheduled Castes and Other Groups
The Pre-Matric Scholarship scheme, launched in 2012, provides support to Scheduled Caste students in Classes IX and X, as well as to children of parents working in unclean and hazardous occupations from Class I to X. The scheme aims to reduce dropouts during transition stages and encourage progression beyond Class X. For SC students in Classes IX and X, eligibility is limited to families with an annual income of up to Rs. 2.5 lakh (3,000 USD), while children of manual scavengers, tanners, waste pickers, and hazardous cleaners are eligible without an income ceiling. This scheme is implemented pan-India through State Governments and Union Territories and provides full-time scholarships to eligible students.
Upgradation of Merit for Scheduled Caste Students
The Upgradation of Merit scheme, first introduced in 1987–88 by the Department of Education and later administered by the Ministry of Welfare from 1993–94, focuses on improving the academic performance of SC students in Classes IX to XII. The programme provides remedial coaching to remove learning deficiencies and offers special coaching for competitive examinations, such as engineering and medical entrance tests. Students are eligible if their parental income does not exceed Rs. 3 lakh (3,600 USD) per year, and the scheme is limited to a maximum of 2,050 new students annually across 19 States and UTs. Each student receives Rs. 25,000 (300 USD) per year, covering boarding and lodging, pocket money, books and stationery, and incidental costs. Additional allowances are provided for students with disabilities, including support for readers, transport, escorts, special pay for helpers, and extra coaching where necessary.
Scholarship for PM CARES Children
The Scholarship for PM CARES Children, launched in 2021, targets children who lost one or both parents or legal guardians due to COVID-19. The programme ensures continuity of schooling from Class I to XII for all eligible children nationwide, irrespective of caste, religion, gender, or location. Eligibility is verified through the PM CARES for Children Portal, and recipients must have an Aadhaar-linked bank account. Each child receives Rs. 20,000 (240 USD) per year, comprising a monthly allowance of Rs. 1,000 (12 USD) and an annual academic allowance of Rs. 8,000 (96 USD) for books, uniforms, shoes, and learning equipment, paid in a single instalment at the beginning of the academic year.
The Beti Bachao Beti Padhao (BBBP) scheme, launched on 22 January 2015 with an initial budget of Rs. 100 crore (13.5 million USD), addresses declining Child Sex Ratios by preventing gender-biased sex-selective elimination and promoting the survival, protection, and education of the girl child. For 2021–22 to 2025–26, the scheme is integrated with Mission Shakti under the Sambal vertical. It is fully centrally funded and implemented across all districts through a joint effort by the Ministries of Women and Child Development, Health & Family Welfare, and Education. Annual district funding is linked to the local Sex Ratio at Birth, ranging from Rs. 20 lakh (24,000 USD) to Rs. 40 lakh (48,000 USD) depending on district SRB levels.
The programme has reported measurable improvements, with girls’ Gross Enrolment Ratio in secondary education rising from 75.51% in 2014–15 to 78% in 2023–24. For FY 2025–26, the Ministry of Women and Child Development has a total budget of Rs. 268.90 billion (3.23 billion USD), of which Rs. 6.29 billion (75.5 million USD) is earmarked for the Sambal vertical, which includes BBBP.
5. School meal programmes
The Supreme Court issued a directive in 2001, ordering states to introduce midday meals in government primary schools; until then only two states provided had a universal meal programme.
The Midday Meal Scheme or PM-POSHAN (Pradhan Mantri Poshan Shakti Nirman), initially launched as the National Programme of Nutritional Support to Primary Education (NP-NSPE) in 1995, currently benefits approximately 118 million children enrolled in around 1.12 million government and government-aided schools across India, covering students from Classes I to VIII. The Cabinet Committee on Economic Affairs approved its continuation for the five-year period 2021–22 to 2025–26, with the total financial outlay distributed between the Central Government, State Governments and Union Territories, and an additional portion specifically earmarked for food grain expenses.
This profile has been reviewed by M. R. Narayana and Pradeep Kumar Chaudhary.
