🚨 Economic Survey 2025-26 Highlights Critical Gaps in Higher Education

India's Economic Survey 2025-26, tabled in Parliament on January 29, 2026, paints a picture of remarkable expansion in higher education while sounding the alarm on persistent quality and learning outcomes challenges. After tackling school-level enrolment and retention hurdles, the spotlight now shifts to universities and colleges where the Gross Enrolment Ratio (GER)—the percentage of the 18-23 age group enrolled in higher education—has climbed to around 29.5 percent from 23.7 percent in 2014-15. Yet, this growth masks deeper issues like skill mismatches, regulatory burdens, and uneven learning achievements that threaten India's demographic dividend.

The survey underscores that while the number of Higher Education Institutions (HEIs) has surged to over 70,000 from 51,534 a decade ago, enrolling more than 44 million students, the focus must pivot from quantity to quality. Elite institutions like the 23 IITs and 21 IIMs shine, but many others struggle with faculty shortages, outdated curricula, and poor employability outcomes. This comes at a time when the National Education Policy (NEP) 2020 aims for a 50 percent GER by 2035 through multidisciplinary approaches and flexible learning pathways.

Expansion of India's Higher Education Landscape

Over the past decade, India's higher education sector has witnessed unprecedented growth. Universities have increased by nearly 60 percent to 1,213, with premier bodies like IITs expanding from 16 to 23 and IIMs from 13 to 20. Medical colleges have more than doubled to 780, reflecting targeted investments. Enrolment jumped 26.5 percent to 4.46 crore students in 2022-23, driven by schemes like Samagra Shiksha and digital platforms such as SWAYAM, which offer Massive Open Online Courses (MOOCs) to millions.

However, regional disparities persist. Southern states dominate medical seats at 51 percent, while northern and eastern regions lag. The Academic Bank of Credits (ABC), now covering 2,660 HEIs with 4.6 crore IDs issued, enables seamless credit transfers, aligning with NEP's multiple entry-exit system adopted by 170 universities. Internationalization efforts, including twinning programs with foreign universities and 100 percent FDI allowance, promise global exposure but require robust quality controls.

What Does 'Learning Outcomes' Mean in Higher Education?

Learning outcomes refer to the measurable knowledge, skills, and attitudes students acquire by program end, shifting from rote memorization to competency-based assessment. The Economic Survey flags weak foundational skills from school spilling into colleges, where students struggle with critical thinking and problem-solving. Post-pandemic assessments like PARAKH Rashtriya Sarvekshan show recovery in school math and language proficiency—Grade III math at 65 percent—but higher education reveals gaps, with only 47 percent of graduates deemed employable per industry reports.

In practical terms, this means engineering graduates lacking hands-on coding skills or humanities students without data analytics proficiency. The survey advocates outcome-focused evaluations, integrating tools like the National Credit Framework (NCrF) to credit skills alongside degrees.

Regulatory Overload and Quality Assurance Hurdles

One of the survey's sharpest critiques targets 'heavy-handed' regulation, with over 50 norms from UGC and AICTE creating compliance nightmares for colleges. This multiplicity stifles innovation, as institutions spend more time on paperwork than pedagogy. Accreditation remains patchy; while NAAC grades top universities, many unassessed HEIs operate without scrutiny.

Faculty shortages exacerbate issues, especially in medical education where 'ghost faculty' and low Foreign Medical Graduate (FMG) pass rates (16.65 percent in 2023) highlight training deficits. Solutions include voluntary regulations, Professor of Practice roles, and CCTV-monitored faculty attendance via Aadhaar.

• Reduce regulatory layers to light-touch oversight based on self-disclosure and outcomes.
• Boost research via Anusandhan National Research Foundation (NRF).
• Implement competency-based curricula in professional courses.

For aspiring academics, platforms like faculty jobs in higher education offer opportunities amid these reforms.

Skill Mismatch: Bridging the Employability Gap

A glaring challenge is the disconnect between college curricula and job market demands. Sectors like electronics, healthcare, and AI crave skilled workers, yet 92 percent of 14-18-year-olds lack vocational training (PLFS 2023-24). Graduates enter a workforce unprepared for Industry 4.0, with fresh doctors earning just ₹5 lakh annually and migrating abroad.

The survey proposes 'earn-and-learn' apprenticeships embedded in degrees, starting from secondary school. Initiatives like MERITE scheme for 275 technical institutions and industry-linked programs aim to integrate work experience as credits. Vocational education's 'missing middle' needs urgent filling to harness India's youth bulge.

Students can explore career advice for higher ed roles to align skills early.

NEP 2020 Implementation: Progress and Pitfalls

Launched in 2020, NEP envisions multidisciplinary HEIs by 2040, Indian languages in teaching, and research as a core pillar. Progress includes biannual admissions in 153 universities and PM-SHRI schools as feeders. Yet, challenges like funding shortages (education spend at 12% CAGR but below 6% GDP), teacher training gaps, and digital divides hinder rollout.

Case in point: Delhi University's cluster system fosters interdisciplinarity, boosting research output, while rural colleges grapple with infrastructure. The survey calls for state partnerships via NITI Aayog's State Public Universities push.

Stakeholder Perspectives on Reforms

Experts hail expansion but urge autonomy. Vice-chancellors note regulatory relief could unlock innovation, while student bodies demand affordable fees amid private sector hikes to ₹60 lakh for MBBS. Industry leaders like NASSCOM push for 1 million AI-skilled workers annually, advocating internships.

Government schemes like ULLAS for adult literacy and scholarships for SC/ST/OBC bridge access gaps.

Economic Implications and Demographic Dividend Risks

With 65% of population under 35, poor higher ed quality risks turning dividend into liability. Unemployable graduates fuel inequality, slowing GDP growth. Conversely, quality reforms could add $1 trillion to economy by 2030 via skilled workforce.

• Enhanced GER supports Viksit Bharat@2047.
• Research hubs position India as knowledge superpower.
• Skill-aligned education cuts youth unemployment (23% for graduates).

Actionable Solutions and Way Forward

The survey outlines pragmatic steps: AI-personalized learning, peer-teaching models (15% numeracy gains in trials), SEL integration for soft skills (USD 11 ROI per dollar), and drone-delivered education in remote areas. For higher ed, prioritize:

• Industry apprenticeships with stipends.
• Voluntary accreditation via Quality Council.
• Frontier labs for AI/robotics.
• Rural incentives for faculty.

Explore university jobs in India or higher ed jobs to contribute to these changes.

Photo by Markus Spiske on Unsplash

Future Outlook: Towards a World-Class System

By 2035, 50% GER and multidisciplinary dominance could make India a study destination. International campuses and twinning will attract global talent, but success hinges on quality leap. Policymakers must invest in faculty (NISHTHA trained 60 lakh school teachers; extend to colleges), infrastructure (91.8% schools electrified; match in HEIs), and equity.

As reforms unfold, platforms like Rate My Professor empower students, while higher ed career advice guides professionals. The Economic Survey sets a constructive path—now execution is key.

In summary, while challenges in learning outcomes and quality loom large, targeted NEP-driven reforms offer hope. Aspiring educators and job seekers, stay informed and upskill via university jobs and postdoc opportunities.