Today the concept of economic development plays a vital role in worldwide nations. The development of any economy mainly depends upon the availability and utilisation of Technology, Capital Accumulation, Natural and Human Resources. Besides other factors, human resources are particularly important for economic development. Hence the government should focus on factors like quality education (both primary & higher education), proper training, skills and health care for human resource development. In this context, this paper tried to analyze the importance of higher education in economic development, the present scenario and growth of higher education institutions in India, the problems that the higher education institutions are facing today at the college and university level, the challenges that are to be addressed and the prospects of higher education in India. The methodology used in the paper is mainly qualitative in nature, and secondary sources like, Economic Survey, AISHE reports are being used to acquire sufficient data to analyze the situation of higher education in India.
Keywords: Availability, Capital Accumulation, Challenges, College, Economic Development, Factors, Health care, Higher Education, Human Resource, Institutions, Instruments, Natural Resources, Population, Problems, Productive, Prospects, Qualitative, Technology, Training, University.