Giving an impetus to education, government today proposed a full interest subsidy scheme on education loans for poor students pursuing technical and professional courses in approved institutes, and allocated Rs 2,113 crore for IITs and NITs across the country.
Presenting the Union Budget for 2009-10 in the Lok Sabha, Finance Minister Pranab Mukherjee said the interest subsidy scheme is expected to benefit nearly five lakh students.
"To enable students from economically weaker sections to access higher education, it is proposed to introduce a scheme to provide them full interest subsidy during the period of moratorium," he said.
The scheme will cover loans taken by such students from scheduled banks to pursue any approved course in technical and professional streams at recognised institutes in the country.
However, only those students whose family income is less than Rs 4.5 lakh per annum will be eligible under the scheme. These students will avail the benefit for a moratorium period which is one year from completion of the course or six month from joining a job, whichever is earlier.
Mukherjee said the government would allocate Rs 2,113 crore for IITs and NITs. The money would a provision of Rs 450 crore for the new eight IITs and 10 NITs. The overall plan Budget for higher education is proposed to be increased by Rs 2,000 crore over the interim Budget estimate, he said.
Giving emphasis on the youths, the government proposed to increase allocations to Rs 495 crore for setting up and upgrade of polytechnics under the Skill Development Mission.
About 50 crore people in the country are under 25 years of age at present.
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Noting that this young population needs to be converted into dynamic economic advantage, Mukherjee said provision for the scheme 'Mission in Education through ICT' has been substantially increased to Rs 900 crore.
The government is committed to set up one Central University in each uncovered state. An allocation of Rs 827 crore has been made for the purpose, he said.
Mukherjee said the low level of female literacy continues to be a matter of grave concern. The government has decided to launch a National Mission for Female Literacy with focus on minorities, Scheduled Caste and Scheduled Tribes and other marginalised groups.
The aim will be to reduce by half the current level of female illiteracy in three years, the Finance Minister said.
Government has also expanded income tax incentives on education loans to cover vocational studies after schooling.
Mukherjee emphasised the need to improve facilities at Punjab University and proposed Rs 50 crore for it. As the Aligarh Muslim University has proposed to open two campuses, one at Murshidabad in West Bengal and another at Malapuram in Kerala, the government proposed to provide Rs 25 crore to each of them, he said.