Saturday, 12 Oct, 2024
By: Niyati Sareen
Image Source: Freepik
From around 368,625 in 2014 to a predicted 18 lakh in 2024, there has been a remarkable growth of Indian students pursuing an education abroad. Driven by the pursuit of quality education along with low acceptance rates in Indian universities, this trend significantly impacts foreign exchange outflow.
Although India has the greatest number of universities in the world, it currently ranks as the second largest source of students studying abroad, after China. The trend of Indian students seeking an education overseas started in the year 2000. Since then, there has been an explosion in the number with a 2598% increase from 66,713 to a ballpark figure of around 18 lakh in 2024.
In 2014, India surpassed China in the international student race for the first time. According to a report by the ICEF Monitor, Indian International enrolment grew by 10.1% as compared to China's 8%. This shift has been driven by not just the glamor associated with a foreign education but also more substantive factors. Considered to be far superior to most Indian universities, the quest for quality education is the primary reason prompting students in this direction. According to a report in The Times of India, “no Indian institute appears in the top 200 global university rankings, indicating a quality issue.” Focused on rote learning rather than conceptual understanding, the Indian education system remains outdated. Hands-on learning methods are key in foreign education systems, providing students with a more comprehensive understanding along with fostering innovation. The intense competition and limited seats in top Indian universities is yet another reason that pushes many students to explore educational opportunities abroad. A report in the Economic Times revealed that “acceptance rates in some elite Indian universities have fallen as low as 0.2% compared to 3% at Harvard and 4% at MIT”, two of the world’s most sought-after institutions. In 2024 over 1.22 million candidates appeared for the Joint Entrance Examination (JEE) for admission in engineering colleges in India, with only 17,740 seats available in the prestigious IIT’s.
The top four countries for Indian students popularly include the USA, Canada, UK, and Australia. The Indian Student Mobility Report 2023-2024 provides a destination analysis on the growth of Indian students in the study abroad market revealing a figure of 27% of Indian students that make up the total international student population in the US. With at least 240000 students currently enrolled in higher education, the US remains the top choice among Indian students. While Canadian universities are on par with US universities, the cost of studying in Canada is much lower, making it a popular destination for students in the past years. The market for Indian students in Canada has grown by 46% since 2019 and they currently account for around 35% of all international students in Canada.
The Economic Times has reported that Indian students contribute twice as much as Canadian students in terms of college fees. Moreover, the favourable immigration policies provide students an easier path to permanent residency. Indian students, comprising 17% of the international student population in Australia, currently total around 127,500. The Australia-India Economic Cooperation and Trade Agreement, which was signed in December 2022, aims to boost both country’s economic growth through free trade and close cooperation along with easing student mobility between the two countries. India is the second largest source of international students in the UK, seeing a 63% increase in these numbers in 2019.
Considering the number of Indian students studying abroad, the total expenditure is substantial and projected to reach as high as $70 billion by 2025. In 2022, it was calculated to be $47 billion, reflecting a 9% surge since 2019 when it stood at $37 billion, as reported by the Indian Student Mobility Report 2023-2024. A country wise breakdown of the total expenditure including tuition, accommodation and other expenses incurred by Indian students in 2023-24, reveals the following: USA $12.5 billion, Canada $11.7 billion, Australia $3.9 billion, UK $5.9 billion. On top of that, “Indian international students are losing around Rs 548 billion in foreign exchange fees,” as reported by News 18.
The remarkable increase in Indian students pursuing higher education overseas in the past decade highlights not only growing aspiration for world class education and global exposure but also signifies a substantial outflow of foreign exchange. If India were to invest in building top-tier educational institutions along with revamping the curriculum, it could retain billions of dollars spent annually by its students in foreign countries. It would not only encourage students to stay back and contribute to the country’s prosperity, but these funds could also be reinvested into the national economy, advancing growth and development.
