Every developed economy treats higher education as productive infrastructure, not discretionary spending. Research universities anchor innovation, productivity, and long-term growth. India once occupied that space as a global centre of learning. Today, it is better known as the world’s largest exporter of students. The steady outflow to the United States, the United Kingdom, and Australia is not merely a matter of preference. It reflects structural limits within India’s university system.
As global student mobility tightens and overseas education becomes costlier and less predictable, India faces a narrowing window to correct this imbalance. Failure to act will lock the country into a permanent role as a supplier of talent rather than a destination for knowledge.
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A widening imbalance in student mobility
The scale of the imbalance is stark. In 2022, India hosted roughly 47,000 foreign students. In the same year, more than 1.3 million Indian students were enrolled overseas. For every international student studying in India, about 19 Indians went abroad. This is not a temporary distortion. Student migration often turns into permanent migration, especially in research-intensive fields. Many who leave for higher studies do not return, taking with them future research capacity, entrepreneurship, and leadership. The loss compounds over time, leaving domestic institutions weaker and more dependent on external ecosystems.
The outward flow also carries a growing economic cost. Education-related outward remittances rose from about $0.16 billion in 2013–14 to nearly $3.4 billion in 2023–24, according to Reserve Bank of India data cited by NITI Aayog. This is a direct drain on foreign exchange, driven not by consumption but by institutional gaps at home. NITI Aayog has warned that if this trend continues unchecked, it will weaken India’s competitiveness in a knowledge-driven global economy. The resources leaving the country represent forgone investment in campuses, laboratories, and research capacity.
Global education markets are turning inward
For decades, advanced economies absorbed international students through predictable visa regimes, generous post-study work options, and globally ranked universities. That situation is changing. Tuition costs have risen sharply. Immigration rules have tightened. Domestic political pressures are narrowing education-linked migration pathways.
OECD assessments show that growth in international student mobility has slowed across several advanced economies. Indian students, who form the largest foreign cohort in many destinations, are particularly exposed. These shifts create risk, but also opportunity. As overseas options become more uncertain, India could retain more of its own students—provided domestic alternatives are credible.
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Public universities remain the weak link
That credibility remains in short supply. Despite operating one of the world’s largest higher-education systems, India is absent from the top tier of global academic rankings. No Indian university features in the global top 50 of the QS or Times Higher Education rankings. Even the IITs and IIMs largely remain outside the top 150.
Capacity constraints are acute. Elite central institutions admit only a fraction of applicants. State universities, which educate the majority, struggle with faculty shortages, outdated curricula, and limited research support. While private universities are expanding, they cannot substitute for a strong public backbone in research-intensive disciplines. In the absence of dependable domestic options, students rationally look abroad.
Governance failures deepen the capacity gap
The problem is not funding alone. Governance and incentives matter as much. Universities operate under fragmented regulation, with overlapping oversight by the University Grants Commission, professional councils, accreditation bodies, and state governments. Compliance often takes precedence over outcomes. Academic and financial autonomy is limited, slowing curriculum reform, faculty recruitment, and international collaboration.
Faculty shortages persist because academic careers in India remain unattractive. Salaries lag global peers. Tenure-track pathways are uncertain. Research incentives are weak, while teaching and administrative loads are heavy. Many early-career researchers exit before their work matures, hollowing out institutions from within. Quality variation further complicates reform. A small cluster of elite institutions coexists with a long tail of underperforming state universities and affiliated colleges, making uniform policy prescriptions ineffective.
Weak industry–academia linkages add another layer of pressure. Employability outcomes remain uneven, pushing students abroad not only for research prestige but for clearer career pathways. At the same time, India’s inward-looking immigration framework undercuts its ambition to attract global talent. Student visas remain uncertain, post-study work options are limited, and long-term pathways for foreign researchers are unclear. Without governance reform, credible faculty incentives, and a more open migration regime, capacity expansion will continue to leak outward.
Internationalisation at home needs real institutions
NITI Aayog’s call for “internationalisation at home” reflects a growing recognition that global exposure cannot remain the privilege of those who can afford to leave the country. Joint degrees, visiting faculty, collaborative research, and globally aligned curricula can embed international standards within Indian campuses. But such initiatives cannot succeed without functioning institutions.
Foreign universities will not partner meaningfully with campuses that lack laboratories, stable funding, or academic autonomy. Nor will Indian students stay if domestic universities cannot offer credible pathways to global careers and frontier research.
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Research funding remains the binding constraint
The most serious bottleneck is research capacity. India’s gross expenditure on research and development has stagnated well below 1% of GDP for years, trailing advanced economies and peers such as China and South Korea. Public universities, which should anchor fundamental research, are often reduced to teaching-only institutions. India trains students at the undergraduate level but exports them for doctoral training, postdoctoral work, and innovation. International researchers and doctoral students find little incentive to locate in India, reinforcing the outward flow of talent.
The opportunity cost is mounting. A stronger onshore presence of foreign universities and international students could save billions in foreign exchange and generate skilled local employment. More importantly, it could help retain intellectual capital that currently exits at its most productive stage.
If India aspires to be more than a supplier of skilled labour, it must invest in universities that can host, compete, and collaborate globally. That requires expanded capacity, sustained public funding, regulatory reform, and genuine academic autonomy—especially at the state level. Without these shifts, India will continue to export ambition and import prestige.