“I am suffering for non-academic reasons. Had I done the course a year earlier, I would have paid some 20% less than now.”
— Natasha Kumar, Indian student worrying about her plans to study at Nanyang Technology University (NTU) in Singapore, quoted by the industry news site Overseas Overwhelmed
Kumar’s concerns are being felt by the hundreds of thousands of Indian students hoping to study in overseas institutions in the near future or already in courses. The reason? The rupee’s rapid and continuing slide against the US dollar; it depreciated by 6.51% in May alone and has fallen by more than 23% in the past year.
Of course this is problematic for Indian students set on studying abroad. A choice to study in an overseas institution is always expensive, but a huge volume of Indian students have nevertheless paid in full in institutions around the world: in 2010–11, it’s estimated that 103,895 Indian students studied in the US, 27,000+ studied in Australia, and 12,000 studied in Canada. The rupee’s declining value will, at the very least, cause students to think long and hard about where they choose to study and to carefully evaluate the affordability of their study options.
Amit Agnihotri, director of MBAUniverse.com, commented to Overseas Overwhelmed: “It may not affect the Ivy Leagues because of their pedigree but it will certainly hamper tier-II foreign colleges that get the bulk of the Indian students.”
The reason for the rupee’s fall is linked to the Euro financial crisis, which has caused investors to sell the euro and buy more US dollars, leading to all major currencies’ depreciation against the dollar. The rupee was affected more than most other currencies due to problems in the Indian domestic economy: sluggish economic reforms and increasing current and fiscal deficits.
“The rupee will be under pressure for the next six to nine months,” predicts Manoj Vohra, director, Asia-Pacific, at Economist Intelligence Unit (EIU), to India’s Business Today.
Rupee’s fall creates opportunities as well as challenges
If some institutions and even country markets stand to lose from Indian students’ greater caution, others stand to gain. Price-sensitive Indian students may not abandon their plans to study overseas but may choose less costly options and/or courses where they have an opportunity to work.
The other positive factor is Indian students’ unabated appetite for study abroad. As Anahita Sahni, who wants to study management in Singapore told The Times of India:
“Getting admission to good Indian colleges is becoming very difficult. Last year, Delhi University announced a 100% cut-off. With such high cut-off marks, it gets impossible to secure a seat. Like me, many of my friends are planning to study abroad.”
The rupee will at some point stop its decline. In the meantime, how will your institution approach the situation? Will it adopt new pricing policies for Indian students, such as discounting, financial aid or staggered payment terms? How will it affect your strategies regarding recruiting students from India?