Union Budget 2025 allocates ₹500 Crore for AI Excellence in Education

On Saturday during Union Budget speech 2025-2026, Finance Minister Nirmala Sitharaman announced the plans to allocate ₹500 crore to establish a new centre of excellence in artificial intelligence (AI) for the education sector.

FM Sitharaman stated, “I had announced three centres of excellence in artificial intelligence for agriculture, health and sustainable cities in 2023. Now, a centre of excellence in artificial intelligence for education will be setup with a total outlay of ₹500 crore."

Besides establishing an AI center of excellence, the Indian government recently revealed intentions to join the global AI competition by developing basic AI models similar to DeepSeek's R1 and OpenAI's ChatGPT.

“The foundational models made in India will be able to compete with the best of the world… With algorithmic efficiency, we can create these models in a much shorter time frame. We will have a world-class foundational AI model in just a few months,” Union Electronics and Information Technology minister Ashwini Vaishnaw said at a press on Thursday.

FM Sitharaman highlighted that the overall student population in IITs has increased from 65,000 to 1.35 lakh in the last ten years and that new facilities will be developed to accommodate 6,500 extra students in IITs founded after 2014 in the next year.

The Finance Minister also declared the government’s plan to establish 10,000 seats in medical colleges and hospitals in the next year, aiming to generate an extra 75,000 seats over the following five years.