2010 report-card and 2011 prediction: Demand from India for International Destinations

With 2010 Indian Student Data available for all major destinations and with UK too showing a huge decline(40%), is it a depression in the industry or a mere correction causing a “depression”!!!

depression |diˈpre sh ən|
noun

severe despondency and dejection, typically felt over a period of time and accompanied by feelings of hopelessness and inadequacy.
• a long and severe recession in an economy or market : the depression in the housing market.

Britain: 2010 and a prediction for 2011.

Now that the UK visa numbers for 2010 are being reported (see link) and with clear indications that the total number from India who will enter Britain for their education during the year to be not more than 35000 (a fall of 40% in 2010 over 2009), the corrections are truly in place and is being expected to finally settle around 25000-30000 per year by 2011. It may be due to the spurt last year was fuelled by sudden loosening of visas that led to thousands ending up in UK even without proper English communication abilities. The correction had to occur and was predicted even on the very first day when the loosening had been initiated. Britain’s total intake from India is likely to hover around 25000 and certainly under 30000. There are also whispers that UK may cut the 2-year post study work permission that now exists for graduating International students. If this happens, the numbers can shrink further.

America: 2010 and a prediction for 2011.

Thankfully, the reporting of the enrolment statistics has a mention of the total visa grants and so the newspapers have put that in right context for the first time. China overtaking India in total enrolments in 2010 is hardly of significance as was India leading in enrolments in 2009, a red-herring. I predict the Chinese numbers to also lower in coming years. The actual demand for a destination comes from the total number of fresh student visas from one country for another. The reports (see link) show that there were 32000 visas from India to USA in one year and I feel that this data is actually a comparable stats to UK’s 57000 of 2009 and my gut feeling is that in 2010, USA received less than 30000 students from India. What will happen in future will depend on how much the US institutions progress in adapting to the education agent-assisted recruitment. If there is progress and if more established University brands accept agents, the numbers can swell and USA can take a clear lead. However the marketing period for 2011 intake for the quality and more rigorous institutions is actually over already considering the lead time in place and one can expect realistically the Indian numbers to USA to hover around 30000 or even less.

Australia: 2010 and a prediction for 2011.

Australia had led the internationalization at one time in history but now is becoming an example of how a country continues to blunder to non-existence of the clichéd “whole of government” approach to Internationalization of education. The student numbers from India in their immigration stats for July 2009 to June 2010 over the earlier period fell by 77% to about 12000. (see my earlier blog with details on link). My gut feel is that if we look at the calendar year 2010, it will be only about 10000 or even less. The question being asked in all quarters is whether it will go down further in 2011 or will it begin to rise. The answer my friend is blowing in the wind. It was expected that Immigration will begin welcoming the quality students and turn on the tap once again for them. Especially when the risk of abuse of Assessment level mechanism being low following 1)so called PR vocational courses losing shine and 2)packaging route to enable easier visas through the higher category has been blocked. However, the “Immigration” continues to be guided by its experience of fraud in student applications though I continue to hope that the checks in place will be able to prune out the rogue from all applicants without disadvantaging genuine students. I feel fatigued from the various submissions made again and again and this fatigue is going to set in also with institutions and various lobby groups who seem to be again actively rushing to Canberra in a bid to get ministers and departments to understand their panic. I also believe that there exists misplaced arguments that lowering of the AL for category 573 will lead to its abuse again. Each passing day is resulting in lower prospects for a revival for the industry. The institutions have to take blame for their late start in lobbying. For a long time the institutions stayed put in the belief that the loss of numbers from India can be made up from China and I remember warning the leading providers that Chinese students enter the process at the ELICOS and pathway stage and so the impact only shows up one year later at the Universities. Which has happened now and so they have finally woken up. Better late than never.

Canada: 2010 and a prediction for 2011.

All reports show that Canada is doing a few things right. The SPP system in place has solved the muddle about the private institutions recruiting from India and given a clear direction. The system is working and the institutions are happy. The market is buzzing too. All indications are that that Canada is the story to watch in 2010-11 and should hit their highest student numbers ever from India. And why not! Canada also does-not hides behind experts that advice delinking of education and work pathways. They are also not compromising in anyway with regards to English requirements or funds and the SPP system is a model that should be adopted by Australia and NZ too as both has a developed private institution setup that is hungry for students. The University sector is also actively wooing the Indian students and recently a number of baits have been announced by way of scholarships. (see link on a major visit by the Universities to India earlier this month).My prediction for 2011 is that the country will continue to show good student numbers and if the institutions can come around to greater coverage of the Indian sub-continent and not just focus on North and West, Canada can top the total student visa numbers across destinations from India by 2012-13.

New Zealand: 2010 and a prediction for 2011

NZ that went up from in 2009 may actually have reached its most limit in 2010 at around  6500 approvals. (This data is the changed figure from the initial blog based on revised inputs received on 26th November 2010. Visa grants in calendar year 2010 till 25th November was 6187 and my estimate is that by the close of 2010 it will still remain around 6500. NZ saw an increase of 10% last year and is once again exhibiting about 10-15% growth this year. While the number of visa applications in 2009 and 2010 are roughly the same, the growth is largely due to reducing rejection rates of visas). The issue is not of the numbers but where they are going within NZ. The growth in 2009-10 was largely due to numbers ending up at the various private colleges and not as many to the Universities. It is now being expected that the numbers will stay well within this total for next few years but more will end up with institutions of repute. The University sector has fine-tuned their marketing in a collaborating format and the results are around the corner for them. The ITPs too have added more and more postgraduate and graduate diploma courses to be able to cater to Indian students looking at studies post their Bachelors. The visa system is finally showing evidence of maturity and the fund transfer scheme will make it easier for borderline students to be able to go ahead beyond the border. NZ too has a future here though my gut feeling is that the numbers will not grow too much but will end up with better institutions now. What is bothering me is the reports that seem to suggest that Education NZ may be merged with Trade NZ and hence going on the line that AEI lost its promotions and marketing role to Austrade. (see link)

Other Destinations: 2010 and a prediction for 2011

Singapore continues to grow but will (or has already) hit its potential in India. The test will be when know of the experience of majority of the Indian graduates from the second tier Singapore institutions with the job market in Singapore or elsewhere. I remain a little circumspect and will wait on for the reports to emerge.

Dubai and UAE has ceased to grow from India in my opinion. There is an audience but that audience is very limited.

China became a destination for Indian medical students primarily due to aggressive marketing by certain education marketers. Screening tests that graduating students have to take in India in line with Medical Council of India guidelines to be eligible as practitioners are reportedly fairly tough and there are several who are not able to clear it in their first attempt. Hence to say that China as such is not a destination but is (or was) driven by the access to cheaper qualification and in hope for their acceptance in India primarily as doctors will not be misplaced. There was a time that USSR was a prime destination for such students when MCI recognized the Soviet Union qualifications for the profession. Now that Medical Council of India has the screening test in place, the time for China as a destination is limited and the future of such students fairly risky. (Read this link to understand the risk)

Malaysia and Thailand have tried marketing in India and barring a few exceptions in AIT in Bangkok or Monash in Malaysia, I would feel that appeal for them in India would remain limited despite cost and visa attractiveness.

Certain European countries such as Switzerland (for Hospitality), France (for Management) and Germany (for Engineering and fee-free education) may hold some interest in India but will never emerge as a major education destination because India students aim at English-speaking destinations.

Conclusion and Overall student trends in 2010-11:

What we need to note is that the total number of Indian students going overseas to study has declined for sure and when we add up the numbers for all the major destinations, it is clear to me that in 2010, there will be less than 120000 students in total who may have travelled out of India on student visas (Despite indications that Canada and NZ have shown a growth). This is an approximate decline of 30% indicating a recession in the industry. I fear a further 15-20% decline in 2011 before it settles down around 100000 students and what will be of interest is the market share of the various destinations then.

The reasons for decline certainly stem from the US recession two years ago followed up with media hyped concerns on student security in Australia and coupled by tightening of post study work opportunities and student visa policies. Some may try to assume this to be a result of growth of Indian education sector that many are opting to study in India itself. I disagree by saying that while the intentions are very much there, no real ground development has taken place yet to convince me. Beyond a few of the Indian private colleges of debatable repute, there are also stories of action against the deemed statuses of some colleges. Foreign University Bill is yet to be passed and even if they are passed, it will take years before capacity can be increased in India.

The fact that recession is very well set in our Industry is also indicative by the fact that there are job-losses and no real indications of immediate upturn. It may actually be camouflaged as a much needed correction but certainly this correction is going to last for a few years and is causing a “depression” in our minds if not in technicality.

8 Comments

  1. A thought provoking observation by Ravi as usual which runs contrary to some spin doctors who keep predicting that the pie will become bigger and bigger, giving somewhat of a “pie in the sky, by and by” message. While some peg their calculations based on rising population figures forgetting or ignoring other factors that contribute to global mobility of students. It is a time for reflection and perhaps a time to relook at what really motivates students to continue their higher education whether at home or abroad. Victor

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    1. Actually, I am of an opinion that my summary that Indian outgoing numbers in 2010 was 120000 is also fairly optimistic. If you try doing a summation of the various totals, it will come to only about 105000… I have started discounting experts for some time now since they always look at wrong statistics to suit their arguments…

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  2. Hey Ravi,

    You have painted the picture very nicely. There is certainly no single / unique reason as to why the numbers are dropping. I am of the strong view that Global recession fuelled with non compliance of mushrooming private education providers is the mother of all problems.

    Future belongs to consolidation for education reps / agents in India. For countries like Australia – U.K the Govt has a role to play to make sure “Education” remains a pious industry and should not land again in the hands of so called entrepreneurs who run the “colleges” to make ONLY commercial interest without social responsibility.

    Finally on the economic front to revive from recession – some communist countries should not devalue their exchange rates as flexible exchange rates are the need of the hour. And reserve currencies should NOT relax fed rates which destabilizes cash flows globally and puts pressure on emerging countries.

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    1. Rahul, there are solutions and suggestions such as the ones that you make. But who is listening??? I call this my fatigue or should I say our fatigue.
      Recessions have psychological and confidence aspects. For example, if the expectation develops that economic activity will slow, firms may decide to reduce employment levels and save money rather than invest. Such expectations can create a self-reinforcing downward cycle, bringing about or worsening a recession.

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  3. I agree the total number of Indian student numbers have declined for sure, yes few issues like global recession, tightening of rules by countries like OZ.

    The UK numbers were up last year as the student visa norms were relaxed and it allowed students with out good academics or English to enter UK for higher studies. How ever there is more to this:

    Foreign Education for Indian students in the past was always considered as a healthy trend or status symbol. People who could afford it were opting for this. In addition to these institutes operating abroad looked for good students from India and they had better infrastructure, facilities and had qualifications which were highly regarded all over the world. For Indian students foreign qualifications ensured them with great exposure, better employment and help in migration.

    All the above is true, however over last few years overseas institutes became very greedy for Indian students, many education providers sprang up overnight, they started marketing aggressively in India, took students with low grades, tried to attract students with delicious incentives like laptops, free air tickets, discounts on fee etc. All they wanted was numbers and yes it worked for them. The numbers grew rapidly, but overseas education lost its charm or value.

    I will blame it on institutes overseas who have damaged the reputation of overseas education in India

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    1. Nishi, You are rushing to put the blame on the institutions. I agree that there are some who are worthy of your blame along with several others in all spheres of the industry. The question right now is about finding a way forward…

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