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Key Points

Indian higher education institutions are projected to see 11% revenue growth by FY2026, fueled by rising enrolments and government investment. Tighter student visa rules in Western countries are redirecting demand to domestic universities, particularly in medical and engineering streams. The sector benefits from doubled central funding and easier education loans, though faculty shortages and affordability remain challenges. ICRA notes the gross enrolment ratio has climbed to 28%, with NEP 2020 targeting 50% by 2035.

Key Points: India Higher Education Revenue to Grow 11% as Demand Rises

  • Medical and engineering streams lead revenue growth
  • Visa restrictions abroad boost domestic demand
  • Government spending doubled in 10 years
  • Gross enrolment ratio rose from 21% to 28% since 2012
2 min read

India's higher education institutions expected to clock 11 pc revenue growth: Report

ICRA reports 11% revenue growth for Indian universities by FY2026, driven by rising enrolments, government spending, and tighter visa norms abroad.

India's higher education institutions expected to clock 11 pc revenue growth: Report
"The higher education sector is poised for growth due to strong demand and government focus - Suprio Banerjee, ICRA"

New Delhi, June 24

The revenue of higher education institutions is expected to expand by 9-11 per cent in FY2026, similar to the growth estimated for FY2025, on the back of expanding seat capacities, improving enrolments and addition of courses, according to a report released by rating agency ICRA on Tuesday.

Moreover, tightening student visa norms in the US, the UK, and Canada is likely to aid Indian higher education institutions in the near to medium term. ICRA’s analysis suggests that the credit profile of these institutes, especially those catering to the medical stream, has witnessed steady improvement in recent years.

With nearly 15-20 per cent of India’s population estimated to be in the 15-24 age bracket, and with improving literacy rates, the demand for higher education in the country is projected to increase over the next decade.

While the increasing cost of higher education has remained a deterrent, improving access to credit (education loan) for students vying for higher education from various financial institutions has been providing support. Additionally, the Centre’s expenditure on higher education has doubled in the last 10 years, which, coupled with the rise in the number of universities from 642 in AY2011 to around 1,189 as of AY2025, has translated into a handsome revenue growth for major universities, the report states.

Healthy admissions, along with an annual fee hike of around 6-8 per cent, have translated into a strong compounded annual growth rate (CAGR) of 15 per cent in revenue growth for these colleges during FY2020-FY2024.

Suprio Banerjee, Vice President at ICRA, said: "The higher education sector in India is poised for growth owing to continued strong demand, increasing disposable family income, easy access to credit, and enhanced Government focus and private sector participation, especially in the medical and engineering stream. However, the sector faces challenges such as fragmentation, infrastructure deficiencies, affordability issues, employability concerns, shortage of qualified faculty, and limited autonomy due to high regulations."

The gross enrolment ratio (GER) for higher education has risen over the years to around 28 per cent in AY2022 from 21 per cent in AY2012. The NEP 2020’s target has been to boost the GER in higher education to 50 per cent by 2035, which, though ambitious, also reflects the large untapped growth potential for the sector, the report added.

- IANS

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Reader Comments

R
Rahul K.
This is great news for our education sector! With stricter visa norms abroad, more students will consider Indian institutions. But quality must keep pace with quantity - we need better labs, faculty and industry partnerships. Hope the revenue growth translates into actual infrastructure improvements. 🇮🇳
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Priya M.
As a parent, I'm worried about the 6-8% annual fee hike mentioned. Education is becoming too expensive for middle-class families. While loans are available, not everyone wants to start their career with debt. Government should regulate fees more strictly.
A
Arjun S.
Medical education in India has improved but still has long way to go. More seats are good, but we need better hospitals for practical training. Maybe some revenue should be mandated for upgrading teaching hospitals? 🏥
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Sunita R.
The 50% GER target by 2035 is ambitious but necessary. In my village, many bright students still drop out after 12th due to lack of colleges nearby. Hope this growth reaches tier 2/3 cities and rural areas too. Education should not be just for cities!
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Vikram J.
Good analysis by ICRA. The private sector participation is crucial - but government must ensure they don't turn education into pure business. Balance is needed between revenue growth and keeping education accessible. Also, employability must improve - degrees without skills are worthless.
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Neha P.
As someone who recently completed MBA, I can say Indian colleges focus too much on theory. With this revenue growth, hope institutions invest in practical learning, internships and industry exposure. That's what will truly make our graduates competitive globally. 💼
K

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