Finance Minister P. Chidambaram on Friday announced a budget allocation of Rs. 344 billion for the education sector. This represents a 20 per cent increase over the figure for the current fiscal.

Of the total outlay for education, Rs. 131 billion and Rs. 80 billion will go for the government's flagship programmes Sarva Shiksha Abhiyan and Mid Day Meal (MDM) scheme.

Chidambaram also announced Rs. 45.54 billion for the Secondary education (SE) sector. The funds for SE would be provided out of the total outlay.

Chidambaram said Mid Day meal would now cover upper primary classes also and extend to 3,484 more administrative blocks. "This would benefit an additional 25 million children. The MDM scheme now benefits 139 million children," said the minister.

For higher education, the government has earmarked Rs 34.4 billion, including 8.75 billion for the University Grants Commission to implement the recommendations of Oversight Committee, which proposes 27 per cent reservation for OBC (Other Backward Classes) students in higher educational institutions. The Rs 8.75 billion will be used for developing infrastructure for the additional intake of the OBC students.

For technical education Rs. 32.05 billion has been provided, besides Rs. 5.2 billion for the National Mission on Information and Communication Technology.

Three new IITs will come up in Bihar, Andhra Pradesh and Rajasthan and the government has earmarked Rs one billion for upgrading the national knowledge network in 410 higher institutions. This, according to Chidambaram, was on the basis of recommendation of the National Knowledge Commission.

For modernisation of madrassas, the government has earmarked Rs. 450 million. This is expected to boost education amongst Muslims.

An HRD ministry official on Friday said the huge budgetary grant for madrassa education would help modernise, standardise and regulate these institutions. It would educate youth to join mainstream of the employment market, he said.

The HRD ministry is now hopeful that the proposed Central Board of Madrassa Education could be set up soon.

Chidambaram also announced 16 more central universities in states that do not have these institutions. At present there are 19 central universities.

To boost the pace of development in the northeast, the government has decided to have a new Indian Institute of Management (IIM) at Shillong, Meghalaya. At present there are six IIMs at Bangalore, Ahmedabad, Lucknow, Kolkata, Indore and Calicut.

Also a new Indian Institute of Information Technology (IIIT) would come up at Kanchipuram in Tamil Nadu. At present IIITs are functioning at Allahabad, Bangalore and Hyderabad.

Also two new Indian Institutes of Science Education and Research (IISERs) will be set up at Bhopal and Thiruvananthapuram. These are besides three existing IISERs at Pune, Kolkata and Mohali (Punjab).

IISERs were created to make education and careers in basic sciences and break the barriers of traditional disciplines. These universities will be devoted to undergraduate and postgraduate teaching in sciences.

The budget has also enhanced the allocation for the Rajiv Gandhi scholarship programme to Rs. 39.66 billion for Scheduled Caste (SC) and Scheduled Tribe (ST) students.

For infrastructure development of 22 Sainik Schools spread across the country, the government has earmarked Rs. 440 million. Also a Rs.800 million for Balika Vidayalaya hostels has been allocated.

In order to have Model Schools in each block in the country, the government has earmarked Rs 6.50 billion. This would help in providing quality education in rural areas.

Navodaya vidayalayas for SC and ST students would come up in 20 educationally backward blocks. Also the Kasturba Gandhi Vidayalya scheme has enrolled over 100,000 girls in residential schools.