Trust in Government: Higher Education

Dec 2, 2022

From holding some of our most prestigious employment positions, to deciding which kissing scenes are appropriate to portray in cinemas, the Indian government plays a significant role in its citizens’ lives, affecting Indians more uniquely than most other countries.

The utter salience of the governance calls into question the level of trust that the citizens of India place in their elected officials, particularly for the burgeoning youth who are more likely to have higher expectations from their leaders.

The Edelman Trust Barometer shows that Indians are the 2nd most trusting of their governments, beaten only by China.

Similarly, the World Values Survey showed that even in 2002, the most trusted institution for Indians was their government.

The trust by youth, in fact, is incredibly high. According to the Goalkeepers Global Youth Poll, 7.2 out of 10 Indian youths are content with the impact that the government has had on their lives, with 56% believing that their leaders care about people like them. This was the highest rating in the world, as found by a study conducted in 2018.

With this in mind, I have decided to explore the major areas of involvement that governments have in youths’ lives and evaluate whether the trust is justly provided, or utterly misplaced.


The government is the main provider of higher education in India, with the All-India Survey of Higher Education (AISHE) 2018–2019 showing that only 395 of India’s 993 universities are privately managed, leaving 60% publicly managed and in the control of the state and central governments. The Hindu reports that 94% of higher education students study in 394 state universities, while less than 6% study in centrally funded universities.

This government monopoly on education means that the Indian student must hold the public & regulatory institutions accountable for the quality of education they receive.

Pictured Above: IIT Kharagpur, a prestigious institution funded by the central government

In terms of funding, we analyzed six financial years to determine a trend. “Financial Years” (FYs) refer to a year as reckoned for accounting purposes, for example India’s FY18 is 1st April 2018 to 31st March 2019. The government has allocated Rs. 99,300 crore to the education sector in the budget for FY20, and has been increasing its expenditure for education in nominal terms for the past few years.

However, what is important to note in a country like India where inflation is rampant is the real spending. Given below is a graph that shows the education budget, adjusted to be in the real value of rupees in 2020.

As the graph shows, the government has been able to consistently portray increases in spending on education, all while the simple fact of inflation means real changes are effectively negligible. This is not a secret, nor is it a surprising revelation — nevertheless, it is a frank reality that most Indians may forget when considering the new budgets each year.

The trend for funding as a percentage of GDP has been downwards, falling from 4.14% to 3.4% from FY15 to FY20. This is in contrast to an average rate of spending of 4.5% in Organisation for Economic Co-operation and Development (OECD) countries, and a rate of more than 4% for the past seven years in China.

When analyzed more deeply, the changes in allocations in the FY20 budget reflect the direction the government aims to take in the coming term, and there is a clear trend towards a concentration of funds in centrally funded universities. The key takeaways are highlighted in this article.


The Rashtriya Uchchatar Shiksha Abhiyan (RUSA) is the segment of the Sarva Shiksha Abhiyan (SSA) that provides funds to around half of the public universities in the country. It was created in 2013 to improve the severe concentration of public funding in central universities, as well as the lack of state involvement in defining the financial support for state universities.

The above graph shows spending on the RUSA in crores. It is important to note that the actual allocated expenditure in FY19 was Rs. 2100 crore, meaning the recent budget has led to a cut of 85%.

To understand what this means, it is important to understand the purpose of the RUSA. It was originally created to be a bridge between the central authority and states as a vehicle for funding, skills, and autonomy to reach state universities.

The scheme has led to major reforms in the higher education sector, including critical changes like the creation of State Higher-Education Councils (SHECs) which are manned by eminent academics and industry professionals. The state governments also create project directorates (Board of Directors) which report directly to the SHECs.

Pictured Above: Professor Raj Kumar, the Vice Chancellor of Punjab University who was appointed as the head of Punjab’s SHEC

This was particularly salient considering that when only central regulatory agencies exist, they can shift the responsibility for ensuring a high quality of education in state universities onto each other. In other words, if there are multiple agencies in charge of the entire country’s education, no one will take responsibility for specific states’ standards. In this way, SHECs filled a severe regulatory gap in the states, as the SHECs cannot blame anyone else for the standards in their state.

Another critical feature was the disentangling of the affiliation system in India, which “affiliates” multiple colleges to universities. This system has led to universities overcrowded with individual colleges which are extremely hard to monitor. There have been calls for abolishing the affiliation system multiple times in the past, yet it has remained a bane to educationists across the country. The RUSA reduced the number of affiliated colleges, created cluster universities, and promoted autonomous colleges.

Pictured Above: Lady Shri Ram College of Delhi University, it is generally considered a top college, outshining many other colleges in the Delhi University itself

These were just a few of the changes that occurred through the RUSA, and according to an article in The Hindu, from the time of RUSA’s formation, Gross-Enrolment has risen, faculty vacancies have fallen, and student teacher ratios have improved. A study from IIT Bombay concluded that “funding linked to reforms has had a visible impact on higher education.”

Taking an incredible amount of funding away from a program addressing reforms in an already deficient sector is a questionable decision, however, considering that spending hasn’t been cut, it is much more telling to see exactly where the funds from RUSA have gone instead.

Changing Allocations:

This graph was created with data from the FY19 and FY20 budgets, and ‘Central Grants’ refer to grants to central universities. As is clear, besides the RUSA, there was a severe cut in spending on scholarships, as well as research. For research, it is important to take into account that the funding for research in FY18 was 350 crore, so FY19 might have been a spike year for funding, so the reduction is actually only 12.3% from FY18.

Grants to central universities, and funding for IITs has risen. IITs are missing 38% of their sanctioned strength in terms of faculty already, so the increased funding has been a long time coming, but only 1.16% of students study in IITs, so the money being moved around is not being distributed very equally.

Evaluation of Government Policy: This signals that the government’s priorities in education seem to be to improve the quality of centrally funded universities and IITs, however, this has not been achieved by an increase in allocation to education spending, but in fact, moving the already scarce funds from state universities to these institutions.

Pictured Above: Nirmala Sitharaman, Finance Minister of 2020, she recently broke her own limit for the longest budget of the union speech, speaking for 2 hours 42 minutes.
She did not mention or explain these changes.

It is important to consider the reasoning the government has given for their education policy moving forward.

This year, the FM said that for the education sector, increased funding would be sourced through External Commercial Borrowing (ECB) and Foreign Direct Investment (FDI), which are basically Indians taking loans from foreigners, and foreign owned universities in India respectively.

She claimed that the government is considering allowing foreign investors to repatriate (or send some profits back home) some of their income, instead of being forced to spend all of their earnings in their Indian operations.

Pictured Above: Indian Prime Minister Narendra Modi at the Bloomberg Global Business Forum 2019, pushing for foreign investment.

However, the literature on the topic suggests that FDI would focus on technical courses in high demand in the country, which would suggest comparatively expensive prices. In simpler terms, when a course is in high demand (such as engineering) and foreign universities offer limited seats, it is very easy for these institutions to raise their tuition fees and still garner more than enough students to fill their seats.

Pictured Above: The gorgeous University of Madras, a state university that ran a budget deficit of Rs. 84.92 crore in 2019 due to inadequate funding, and inability to raise fees.

Given this fact, the students in state universities — which have suffered the brunt of the cuts — are very unlikely to be able to afford these foreign run or financed universities, even if this FDI manifests in the way the Indian government expects it to. There are complicated regulations in India for foreign run universities, and scary fines up to 50 million rupees (on top of tuition refunds) if they are not met. These are strong disincentives for FDI, and thus, the expectations of foreign investment are still quite questionable.

Conclusion: In conclusion, it seems that education does not seem to be a priority for the current government in terms of funding and finance, and although there are clear signs of improvement in some cases, there is a structural problem with finance in the education sector.

The single action that is long overdue for the government is to increase spending as a whole on the education sector to match other countries of our size and development stage. Further, the RUSA — and state universities as a whole — need increases in both funding and development, as there is an obvious difference in oversight between the central and state level.

Pictured Above: Former UN USG, and current MP of Thiruvananthapuram, Dr. Shashi Tharoor giving a TED Talk on soft power, where he addressed the urgency of focusing on education in India

Finally, the Indian government needs to be clear cut with a tangible plan to improve the state of higher education in their country. It is a brute fact that India is a young country run by old leaders. Yet, perhaps quite shockingly, it is an accepted reality of life that the Indian education system is broken.

As Dr. Shashi Tharoor put it, we have “islands of excellence” in a “sea of mediocrity”. With the budget for FY20, it seems the government is tearing down the rafts that 94% of our country are clinging on to, so they can continue shoring up the banks of the IITs, IIMs, and DUs of our time. The 600 million youths who trust their government more than any other country in the world deserve better.