For many Indian students, there are better prospects abroad.
The sight of Indian students at English-speaking universities is becoming more common.
Over the past two decades, the number of students studying abroad has tripled to more than six million.
The majority of that increase is due to Chinese students. This is to expand their minds and opportunities.
In return, they brought valuable brainpower and large sums of foreign cash.
Sometimes, governments have viewed this money as a reason to invest their own money into higher education.
Universities in Australia, Britain and Canada have grown increasingly reliant on foreign flows to subsidise research and to cover the costs of educating local scholars.
The market has now witnessed a shift where Indian students are becoming the main source of growth.
In 2022, the UK issued more student visas to Indian nationals compared to Chinese nationals. This was also the case in America.
In both countries, it was the first time in years that this had occurred.
Why are More Indian Students studying Abroad?
Compared to Chinese students, Indian students have different demands.
Indian students are much more likely to want to carry on living and working in their host countries after their courses end.
Economically, this could benefit labour markets.
But it could provoke more heated discussions about immigration.
A youthful demography and fast-increasing wealth drive students to leave India to study abroad.
Given that it is home to 1.4 billion citizens, India has more people of university age than anywhere else.
According to Oxford Economics, the number of middle and high-income households in India is expanding by around 10% each year.
As aspirations increase, enrollment in India’s universities and colleges is surging.
In 2001, around 9 million Indians were attending higher-education institutions. Today, the student population has grown to approximately 43 million, surpassing America to become the second-largest in the world after China.
More growth is expected: enrollment in tertiary education (the proportion of students among the college-aged population) is still below 30%, less than half of China’s rate.
The government aims to raise this to 50% by 2035, which would bring total enrollment to nearly 75 million.
However, this expansion has not done anything to improve the poor teaching and research quality in many Indian institutions.
No Indian university is ranked in the world’s top 100.
NV Varghese, of the National University of Educational Planning and Administration in Delhi, says the higher education system has “islands of excellence”.
But it also has an “ocean of mediocrity”.
Competition for spots at the best places is furious. Several Indian institutions have rejection rates higher than America’s Ivy League, including the formidable Indian Institutes of Technology.
For many Indian students, there are better prospects abroad.
They also find it easier to finance their studies as banks are becoming more willing to issue student loans for foreign study.
Driven by these factors and the lingering effects of the Covid-19 pandemic, when many young people postponed their educational plans, the number of Indians studying abroad has recently surged.
In the first 10 months of 2023, approximately 760,000 Indians went abroad for some form of study, according to government estimates.
This figure is about 30% higher than in 2019.
Overall, it is estimated that around 1.5 million Indian students are studying overseas, an increase of about 38% compared to pre-Covid numbers.
In the United States, the number of Indian students at colleges and universities has grown by approximately 37% over the past five years, reaching 270,000.
Striking a Balance
The rise of Indian students studying abroad is a good thing for both India and the countries where they go to study.
Mr Varghese says students who go abroad generally do well and “better than they would do at home”.
Those who return bring back valuable skills and this is highlighted by the fact that India’s top universities are full of foreign-educated academics.
Meanwhile, countries like the US, Australia, the UK and Canada see an opportunity to grab talent, particularly in engineering, computer science and maths.
Such skilled workers can boost research, innovation and much more.
Western universities also believe Indian students may help to maintain demand for their expensive degrees even as the number of Chinese students dwindles.
For years, analysts have warned that the decades-long surge in Chinese student arrivals might be nearing its peak, a trend likely accelerated by the pandemic.
China’s youth population is decreasing, its universities are rapidly improving and growing tensions with the West may make Chinese students feel less welcome abroad.
Additionally, there are concerns that Chinese employers might begin to see Western degrees as less valuable.
While the influx of new students presents opportunities, it also introduces risks.
The most significant threat is that changes in the countries sending international students can influence voter attitudes in receiving countries.
Debates over immigration in wealthy nations are becoming increasingly contentious. As the number of international students grows, they are more frequently entangled in these disputes.
Indian students differ from their Chinese counterparts in ways that might exacerbate these conflicts.
Indian students are generally less wealthy and tend to prefer more affordable, lower-tier universities and shorter courses.
They are more likely to pursue postgraduate studies rather than undergraduate degrees because financing a one or two-year master’s programme is more manageable than funding a full bachelor’s degree abroad.
In the UK, a typical Indian student spends about half as much on tuition as a Chinese student.
Indian students also show a stronger desire to remain in the countries where they study after graduation.
Most major destination countries offer “post-study” visa schemes, allowing graduates to stay for a few years with minimal restrictions.
Indian students prioritise these options when choosing where to study, and the terms of these schemes can influence lenders’ willingness to provide loans for their education.
These differences bring complications. Postgraduate students are more likely than undergraduates to request visas for spouses or children.
“Post-study” visa schemes, previously under the radar, are becoming more contentious.
Lower spending per student means that countries need to admit more students to achieve the same financial benefits. The low and middle-tier universities that benefit most from Indian students lack significant influence in policy discussions.
Recently, regulations for foreign students have been tightened.
In the UK, most international students are restricted from bringing dependants.
Such measures are not uncommon because governments frequently fluctuate in their policies when it comes to international students.
According to Matt Durnin of Nous, a consultancy with offices in Australia and the UK believes something more fundamental is afoot.
For years, Western countries have become accustomed to students who were financially affluent and returned home immediately after graduation.
Now, they are realising that “the game is completely different”.
The risk is that wealthy nations might increasingly miss out on the opportunity to attract talented young individuals.
What’s more worrying is that they might do this without reconsidering the financial arrangements that have made their universities increasingly dependent on income from international students.
Given the significant economic benefits that vibrant, well-funded universities bring, such a move would be a serious mistake.