Impact of Foreign Universities on Higher Education

Foreign universities are actively planning to set up branch campuses in India, especially in GIFT City (Gujarat) and Navi Mumbai, after the UGC (FHEI) Regulations, 2023, allowed their entry under the National Education Policy (NEP) 2020. This move is expected to reshape India’s higher education landscape.

Why Are Foreign Universities Coming to India?

• Global Financial Pressure on Universities
  • In developed countries, declining birth rates have led to falling domestic enrolment in higher education.
  • Universities in the UK, US, Canada, and Australia now depend heavily on international students for tuition income.
  • Example:
    • UK: 22% of students are international
    • Australia: 24%
    • Canada: 30%
    • US: 6% overall, but 27% at Ivy League schools
• Recent Restrictions on International Students
  • Australia and Canada have capped student visas.
  • UK imposed tougher visa rules in 2024.
  • These policies are hurting universities' finances; hence, they are exploring India as a new education market.

Why India is Attractive?

• Large Youth Population & Growing Demand: With over 40 million students, India is one of the largest higher education markets. Gross Enrolment Ratio (GER) is still below 30% — indicating huge untapped potential.
• Rising Affordability: As incomes rise, more Indian families may afford foreign-branded education delivered domestically.
• Low Quality in Existing Institutions: Apart from a handful of elite institutes (IITs, IIMs, AIIMS), many public and private HEIs in India are mediocre. Foreign universities can fill this quality gap.
• Home-based Global Degrees: Students who wish to work in India or cannot afford to study abroad may prefer these branch campuses. This helps in reverse internationalisation — world-class education coming to students, not the other way around.

Key Challenges for Foreign Universities in India

• Price Sensitivity: While India has student numbers, the average Indian family is cost-conscious. High tuition fees may deter mass enrolment in the short term.
• Mixed Global Record of Branch Campuses: Several foreign campuses in Asia and the Middle East have shut down or lost money due to low demand or mismanagement.
• Limited Impact Initially: Even with 10–20 foreign campuses, the number of students served will be marginal compared to India’s total student base.
• Accreditation, Regulation, & Integration: UGC norms allow for academic freedom, but operational issues, cultural differences, and regulatory compliance may still pose barriers.

Governance & Policy Significance

• The NEP 2020 aims to internationalise India’s higher education and bring global standards to local campuses.
• The UGC (FHEI) Regulations, 2023 are a major reform in this direction.
• This move could trigger reforms in domestic institutions, increase competition, and improve standards.
• Over time, it may also help India emerge as a regional education hub, competing with destinations like UAE, Singapore, and Malaysia.