Announcements on AI in the 2025-26 Union Budget
In line with India’s goal to build its own AI foundation models, the 2025-26 Union Budget saw some key announcements for driving AI innovation
The 2025-26 Union Budget was tabled on February 1 in Parliament. The Budget had some announcements relating to Artificial Intelligence (AI). In light of India’s plans to build its own AI foundation model, the announcements in the Budget represent a step forward in that direction. This blog takes a look at these announcements.
Rs 2,000 crore allocated to the IndiaAI Mission for 2025-26
The IndiaAI Mission has been allocated Rs 2,000 crore for 2025-26, an increase of 1056% from the 2024-25 revised estimates (See Table 1). The IndiaAI Mission seeks to promote the development of AI in India by providing the required infrastructure, funding, and skilling.
Source: Demands for Grants, 2025-2026, Department of Higher Education, Ministry of Education.
IndiaAI Mission Outputs for 2025-26
According to the 2025-26 Outcome Budget, the Mission aims to establish 20 AI Curation Units across Central Ministries. These Units will be responsible for curating datasets with non-personal data. 80 IndiaAI Labs will also be established nationwide, serving as hubs for AI research and development. Another key focus will be supporting the startup ecosystem, with plans to finance 25 deep-tech startups.
Centre of Excellence for AI in Education to be established
The Finance Minister announced the establishment of a Centre of Excellence (CoE) for AI in education, with an outlay of Rs 500 crore. This will be the fourth CoE for AI in India. The other three are in the areas of health, sustainable cities and agriculture that have been allocated Rs 990 crore for the period 2023-24 to 2027-28. These Centres are designed to foster interdisciplinary research, develop applications, and create scalable solutions in these fields. In 2025-26, CoEs have been allocated Rs 200 crore by the Ministry of Education (See Table 2). Note that in 2023-24, CoEs were allocated Rs 35 crore, of which Rs 16 crore (46%) were utilised.
Source: Demands for Grants, 2025-2026, Department of Higher Education, Ministry of Education.