The Economic Survey on Wednesday suggested fee hike for higher education even as it regretted that it may not be implemented due to "constraints of political economy."

"At the higher level there is a case for greater cost recovery, but the political economy constraints may go against the enhancement of user charges," the Survey, tabled before the Lok Sabha on the eve of Budget, said.

Economic Survey 2003-2004: Complete Coverage

Expressing concern over poor literacy rate in the country as compared to other developing nations, it said India was far behind other countries in the region including China and Sri Lanka despite registering a "dramatic" literacy rate of 64.8 per cent in 2001.

Citing examples of Malaysia and Sri Lanka, it said lower level services were delivered free of charge on the principle of universality and even the World Bank was persuaded against the imposition of user charges.