The trend of Indian students pursuing higher education abroad has contributed significantly to India's growing current account deficit, recently reported at US$6 billion.
Over the past decade, expenditure on educational travel by Indians has surged from US$2.46 billion in fiscal year 2015 to US$6.3 billion in fiscal 2024. This increase reflects rising income levels among India's middle class, the allure of better-paying jobs abroad, and the use of education as a pathway to immigration.
In 2019, approximately 1.09 million Indian students studied overseas. This number rose to 1.32 million by 2022 and is projected to reach 2 million by 2025, with spending potentially hitting US$70 billion. Popular destinations include the US, Canada, the UK, and Australia, which are known for their high tuition fees and living costs. Other sought-after locations are Germany, Ireland, Singapore, Russia, the Philippines, France, and New Zealand.
Despite this growing outflow, Indian universities are seeing a decline in international student enrolments. Revenue from foreign students in India dropped from US$519 million in fiscal year 2015 to US$247 million in 2024. Although there was a slight increase in 2023 and 2024, the numbers remain below pre-2015 levels. Efforts such as the National Education Policy (NEP) 2020 and initiatives like the Study in India programme have aimed to enhance India’s appeal as an education destination. However, these measures have yielded limited success, with foreign student enrolments showing only modest growth and recent declines linked to the COVID-19 pandemic.
Most international students in India come from South Asian and African countries, with Nepal being the most significant contributor. The US, Bangladesh, and the UAE comprise substantial portions of the foreign student body.