The district primary education programme is to be extended from 64 administrative areas to 122, representing more than a fifth of the country.
The programme is designed to tackle the country's chronic problems of illiteracy, poor access to schooling and high drop-out rates. It concentrates on building schools, training existing teachers and spreading child-centred learning methods.
"What we are talking about is overhauling the entire primary education system," said Dr Jyotsna Jha, a consultant to the national programme. "The idea is to create replicable models so that other districts can adopt some of the methods of intervention."
Funded by loans from the World Bank, grants from the European Union, Britain's Department for International Development and the Dutch government, the expansion alone will cost $450 million (#163;265m). The total programme is estimated at more than $1 billion (#163;590m).
The scale of the problem it addresses is also enormous. According to the World Bank, 32 million primary-age children in India do not attend school and the country has more illiterates than any other nation. Nearly 40 per cent of women and 60 per cent of men cannot read and write.
Central to the programme is the introduction of activity-based techniques and group work, with an emphasis on learning by doing and enjoyment. Traditional methods of rote learning from old-fashioned, government-controlled textbooks are blamed for the failure to attract pupils to schools and keep them there.
Anita Kaul, the programme's director in Karnataka, a state with a population of 55 million, said mobilisation of parents and local communities was crucial to making the system accountable. Teachers abandon their classes at the whim of distant officials to arrange political rallies or carry out census work. Corruption is endemic.
In Karnataka, theatre troupes are sent into the villages to perform street plays and sing about the value of education and the need to end discrimination against girls and low-caste groups.
Research is then carried out in villages to find out why children are not attending school, and a village education committee is formed.
Ms Kaul explained: "If girls are staying at home to mind siblings, a pre-school centre could be sited next door to the school or the timings of lessons could be changed. We need to ensure that at village level we leave behind a group of people who can take responsibility for universalising primary education."
A tour of villages in Kolar district on the granite plains of eastern Karnataka revealed enthusiasm among teachers and parents for the new methodologies that the district primary education programme is encouraging.
Freed from the confines of the government textbook, ND Rukmani, a teacher at Kurki lower primary school, said: "The children are attracted to the school because of the new materials. Even the drop-outs are attending. " Schools are given 500 rupees a year (about #163;9) to develop new "joyful learning" resources.
In Balamanda, at a training meeting for village education committee members from 18 villages, one member, M Pattnanna, said: "Before this programme the students were not eager to come to the schools but now they are very eager to enter and learn."
Another said: "Earlier education was taking place mechanically. These activities - inside and outside - are attractive to parents."