New Education Policy 2020 and Financing of Higher Education in India

Abstract

Education plays an important role in economic growth by improving productivity and increasing national product. With the growing importance of knowledge in the growth process higher education assumes critical importance in policy making. Higher education plays an important role in knowledge production through its Research & Development (R&D activities and in the use of knowledge produced elsewhere through its contribution to production of knowledge-based goods. Given its role in development, governments and individuals/households have been increasing their investment in higher education leading to massification and further to universalization of higher education in many countries. But the major challenges are maintaining national competitiveness while offering a quality but affordable education across the nation amongst the various socio-economic strata. With the enactment of New Education Policy 2020, the issue of affordability therefore brings in the role of public sector in financing of higher education in India.