On August 27, 2024, Australia’s Education Minister, Jason Clare, announced a significant policy change affecting the future of international students in the country. Pending parliamentary approval, Australia plans to introduce a National Planning Level (NPL) that will cap the number of new international students at 270,000 for the calendar year 2025. This decision marks the lowest intake in the past five years and follows a recent increase in Australian student visa processing fees.
What the 2025 Cap Entails
The new cap of 270,000 international students for 2025 represents a substantial decrease from the 561,000 international students who began their studies in Australia in 2023. This new restriction will be a significant shift, especially considering that 2023 saw the highest intake of international students in recent years.
Under the new policy, publicly funded universities will be allowed to admit up to 145,000 students, maintaining the 2023 levels. However, other sectors will see reductions. The vocational education and training (VET) sector will accept 95,000 new students, while other universities and non-university providers will be capped at 30,000 new intakes. This reduction is aimed at more effectively managing the influx of international students, but it also reflects a broader trend of tightening immigration and education policies in Australia.
Historical Context and Current Trends
Australia’s international student intake figures show a fluctuating pattern over the past few years. In 2023, the country welcomed 561,000 international students, a significant increase compared to previous years:
- 2022: 388,000
- 2021: 282,000
- 2020: 396,000
- 2019: 519,000
Between January and May 2024, Australia saw approximately 289,000 new international student commencements, marking the highest number on record for this period and a 16% increase compared to the same period in 2019. Despite this robust start to the year, the introduction of the cap for 2025 indicates a more cautious approach moving forward, potentially influenced by the ongoing global economic and political uncertainties.
Exemptions from the Cap
Certain categories of international students will be exempt from the new cap. These include:
- School students
- Research degree students
- Students pursuing standalone English language courses (ELICOS)
- Non-award students
- Government-sponsored scholars
- Students involved in Australian transnational or twinning arrangements
- Key partner foreign government scholarship holders
- Students from the Asia Pacific and Timor Leste
This exemption ensures that critical sectors and partnerships are not disrupted by the new policy, allowing continued support for key educational programs and international collaborations.
Impact of the Visa Fee Hike
The policy shift comes shortly after a substantial increase in Australian student visa processing fees. From July 1, 2024, the fee for international student visas rose dramatically from AUD 710 to AUD 1,600 (approximately Rs 40,524 to Rs 91,321). This represents the largest fee increase in the past five years. For comparison, other popular study-abroad destinations for Indian students have significantly lower visa processing fees:
- Canada: AUD 170
- US: AUD 290
- New Zealand: AUD 345
- UK: AUD 940
The high cost of Australian student visa applications, coupled with the new cap on admissions, creates a more challenging environment for prospective students. The financial burden is likely to deter many from pursuing studies in Australia, pushing them towards more affordable or accessible options in other countries.
Implications for Indian Students and Australian Universities
The reduction in the number of international students allowed to study in Australia is expected to have several repercussions:
- For Indian Students: The new cap and increased visa fees are likely to reduce the number of Indian students heading to Australia. Many Indian students may seek alternative destinations such as the US or Canada, where visa costs and policies may be more favorable. This shift could also impact the business of immigration consultants in India, which has seen significant growth due to the demand for Australian education.
- For Australian Universities: The Group of Eight (Go8) universities, which represent Australia’s leading research institutions, have criticized the new policy as detrimental. The reduced intake of international students could lead to financial shortfalls, as these institutions rely heavily on tuition fees from overseas students. The cap could also impact the universities’ global reputation and their ability to attract top talent and maintain diverse academic environments.
Hot Courses Abroad and the Australian Market
Australia has traditionally been a top destination for hot courses abroad, attracting students from around the world due to its diverse offerings in fields such as engineering, business, and health sciences. However, the new cap and visa fee hike may drive students to explore other countries that offer similar hot courses abroad without the added financial and regulatory burdens.
As more Indian students and others consider alternatives, Australia may see a decline in applications for these sought-after programs, further impacting universities that rely on international enrollment for specialized courses.
Australia’s new cap on international student intake and the recent increase in visa processing fees mark a significant shift in the country’s approach to managing international education. For Indian students, these changes may prompt a reevaluation of study-abroad destinations, potentially redirecting them to other countries with more accessible options. For Australian universities, the policy could lead to financial challenges and impact their global standing. As the situation develops, both students and educational institutions will need to adapt to the evolving landscape of international education.