Regarding the financing of higher education institutions in Azerbaijan, they primarily rely on tuition fees. University revenues from scientific research do not constitute a significant share of their overall budget. Moreover, subsidies from the state budget are allocated to cover the expenses of a number of universities. For example, the 2026 budget allocates 100.1 million manats for this purpose, which is 5.3% or 5 million manats more than in 2025.
Although the “Budget Guide” presented by the Ministry of Finance does not provide a complete list of universities dependent on the state budget, two universities are mentioned. One of them is the “Azerbaijani-Turkish Joint University,” founded in 2024 and which began operations last September. 6 million manats have been allocated to ensure its operation. It is planned to educate 300 students in engineering and medical specialties. 10 million manats were allocated for these purposes in the 2024 state budget.
The second university is “Karabakh University,” which will operate in the city of Khankendi. 39 million manats have been allocated for the university. It is planned that from the 2025/2026 academic year, up to 4000 students will study there in 6 areas and 34 specialties, including 100 students in medical specialties, with accommodation in dormitories.
616 million manats are allocated for financing state-funded places in universities, which is 47.8 million manats more than in 2025. Of this amount, 412 million manats will be directed to tuition fees, 177 million manats to scholarships, and 27 million manats to other educational activities. The increase is mainly due to the increase in the number of students studying under state funding. It is expected that this year their number will increase by 5210 people, reaching 150,102, and the number of scholarship recipients will increase by 7520 people, reaching 121,280.
In addition, to ensure access to higher education for low-income segments of the population, the Student Educational Loan Fund was established in 2022. In this year’s state budget, 15 million manats will be allocated to the fund for expanding educational loans. Last year’s budget allocated 8 million manats for these purposes. Thus, taking into account the funds allocated in previous years, the total budget of the Student Education Loan Fund is expected to reach 141 million manats.
According to the fund’s data, to date, 68,800 bachelor’s and master’s students have been able to utilize these loans. The latest report from the fund indicates that in 2022–2025 (including the first four months of 2025), 54,400 bachelor’s and master’s students received loans totaling 53.3 million manats. During this period, only 2.6 million manats were repaid.
The fund provides educational loans under two packages – social and standard. The social student loan is issued at 2% per annum, and the standard loan at 6%. After graduation, students are given a grace period of two years, after which the loan can be repaid over 10 years.
Since 2022, 6,519 students who received educational loans have already graduated. According to the fund, 59% of graduates (3,849 people) whose loan repayment period has begun have found employment. At the same time, 41% of graduates (2,670 people) who received loans are currently unemployed. This indicator points to the serious difficulties faced by young people in Azerbaijan in finding official employment after graduating from university.
The State Employment Agency’s “Graduate Employment Ranking” also notes that approximately 62–63% of bachelor’s degree graduates enter the labor market and find employment within two years. In OECD countries, on average, 86–87% of university graduates find employment within 1–3 years. In countries such as Germany and the Netherlands, this figure reaches 90%. Moreover, most of those who do not find employment usually continue their education at the next level.
