FM Sitharaman announces Rs.500 Crore Centre of Excellence for AI in Education

Union Finance Minister Nirmala Sitharaman, while presenting the Budget for 2025-26, emphasized the transformative role of Artificial Intelligence (AI) in education. She announced the establishment of a Centre of Excellence for AI in Education with a ₹500 crore outlay.

The announcement follows the release of the Economic Survey 2024-25, which highlighted the scale of India’s education system—serving 24.8 crore students across 14.72 lakh schools with 98 lakh teachers. Government schools make up 69% of the total, enrolling half of all students, while private schools account for 22.5%, catering to 32.6% of students. With the National Education Policy (NEP) 2020 targeting 100% Gross Enrolment Ratio (GER) by 2030, AI is expected to play a critical role in bridging learning gaps, improving accessibility, and enhancing teaching methodologies.

By integrating AI into the education sector, the government aims to boost student engagement, provide data-driven insights for educators, and improve learning outcomes across primary, secondary, and higher education levels. The initiative aligns with India's broader digital transformation goals, ensuring that students are equipped with future-ready skills in an increasingly AI-driven world.

Nirvaan Birla, Managing Director of Birla Open Minds Education Pvt Ltd and Birla Brainiacs

“The Union Budget 2025 presents a forward-looking vision for the education sector, aligning with India’s goal of becoming a knowledge-driven economy. The emphasis on skilling through National Centres of Excellence, the PM Research Fellowship Scheme, and AI-driven education hubs is a commendable step towards strengthening India's human capital and fostering technological innovation. The expansion of IITs, medical institutions, and Atal Tinkering Labs further reinforces the government’s commitment to building a future-ready workforce. The Bharat Net project’s broadband expansion in schools is a welcome move to bridge the digital divide, but its success will depend on effective accessibility and implementation.

However, the real challenge lies in execution. Streamlining PPP models for upskilling, simplifying regulatory frameworks for edtech, and ensuring efficient subsidy distribution will be crucial for achieving meaningful impact. Additionally, greater emphasis on facilitating ease of doing business for private players, including support for trade fairs and global collaborations, would have further strengthened the sector.

As we align with the vision of Viksit Bharat, ensuring that these ambitious initiatives translate into tangible outcomes will be key to empowering students, educators, and institutions. This budget sets a strong foundation, and with strategic execution, it can drive meaningful transformation in India’s education landscape.”

Varun Satia, Founder & CEO, Kraftshala.

The Union Budget 2025 makes important moves to strengthen India's education and skilling system. The establishment of a Center of Excellence in AI for education, the expansion of Atal Tinkering Labs, and the creation of five National Centers of Excellence for Skilling under the 'Make for India, Make for the World' initiative all show a strong commitment to innovation and practical skills.

To build on this, it is important to connect these skilling programs with mainstream higher education. Short-term, industry-approved courses should be given priority along with traditional degrees to prepare students with job-ready skills. While using AI in education has great potential, its benefits will be best realized when combined with good mentorship, hands-on learning, and real-world experience.

This budget sets a solid foundation, but its success depends on effective implementation. Moving forward, sustained collaboration among academia, industry, and policymakers will be key to creating a dynamic, future-ready workforce.

Jairaj Bhattacharya, Co-Founder & CEO, ConveGenius.AI said:

"The Union Budget 2025 marks a defining moment for India's education landscape, with a strong push towards AI-driven learning, skilling, and digital accessibility. The ₹500 crore Centre of Excellence for AI in Education will accelerate innovation, while expanding Atal Tinkering Labs and broadband in schools will help bridge digital divides at scale.

For ed-tech enterprises like ConveGenius.AI, these initiatives reaffirm our mission of making AI-powered, adaptive learning accessible to every learner. Strengthening foundational learning and skilling investments reflects the growing urgency for personalised, tech-driven solutions that can drive real impact.

This budget is a step in the right direction towards democratising quality education, but its success will depend on sustained execution and meaningful public-private collaboration. We are excited to contribute to this vision and ensure last-mile access to future-ready learning opportunities."