Recent changes by the government to student visas are worrying Australian universities, which forecast drops in the number of foreign fee-paying students on whom they rely. Visa applications for higher education fell by 11 per cent last year compared with the previous year.

Not everyone studying in Australia stays back
Of 630,000 international students in the country in December last year, about 65,000 migrants who came to Australia last year were former international education students. That is 10 per cent of the total industry.

So what do the other 90 per cent do? They go home, they provide benefit to their communities from the experience they've had. Australia says the international student sector is valued at $18 billion and is Australia's third largest export.

Australia stands at the top in the industry
For more than a decade, the world watched enviously as Australia transformed the art of teaching foreign students into a formidable venture. Many countries have kept a close eye on the way Australia took control over a hefty chunk of the global international student market by attracting students by linking study in Australia to permanent residency. And they have admired the economic pragmatism that has underpinned the success of international education in Australia.

What happened?
Over the past 18 months a number of factors have led to a fall in the number of overseas students wanting to study in Australia. Universities which rely on international student fees to an extent, are expressing their concerns now. However in Australia such issues are not given wide publicity. What's brewing here is deep frustration among universities that recent government policy changes are fuelling the drop-off in international students.

In an attempt to crack down colleges mushroomed for visa purpose, and weaken the link between immigration and education, the government last year tightened rules governing student visas that led to a consequent drop of student enrolments. The issue is to a degree a political issue since universities rely on international student fees for an average of 16 per cent of their total funding, and use much of that revenue to cross-subsidise domestic students.

A Melbourne University education economist, Ross Williams likens the government strangling the supply of international students to a "tap being turned off a little". He predicts damage to universities will reverberate through the economy, with fewer international students affecting property prices (since these students form a large part of the rental market), and dampening demand for ancillary services such as cafes around universities.

Impact of the changes
In a sign of growing concern, the Group of Eight leading universities has warned that a decreasing amount in international student numbers would have issues. They have called on responsible parties to take action to shed light on the international education industry. They want changes to student visa arrangements to ensure legitimate students are not discouraged from applying to Australia.
Australia's reputation as a global education provider has begun to have an impact with certain unfavourable incidents on foreign students, the collapse of private colleges, the immigration debate during the election campaign and tougher student visa rules.

In the Gillard government's new ministerial line-up, Chris Bowen will become the Immigration Minister while Senator Chris Evans has stepped into the Skills and Tertiary Education portfolio.

In the meantime the tertiary institutions are determined to provide a stronger university education to local and international students. Contrary to the fact of the industry facing certain amount of anxiety, there is hope among education providers the new Minister will bring about changes to policies and procedures that will make a difference.

An extract from Sydney Morning Herald by Sushi Das and Sarah-Jane Collins