Australia caps foreign student intake: What it means for Indian applicants

Australia has announced a 270,000 limit on new international student commencements for 2025 and directed universities to ensure domestic students form the majority.

Australia has long been one of the top choices for Indian students pursuing higher education abroad. By 2024, the country hosted nearly 800,000 international students, with around 17 per cent from India, reinforcing its position as a global education hub.

 

Government urges universities to prioritise local students

 

The Australian government is now asking universities to ensure that domestic students remain in the majority. Education Minister Jason Clare said that Australian students must make up more than half of total enrolments, noting that some institutions, including the University of Sydney, Murdoch University, and RMIT, currently have international students exceeding that threshold.

 

In August 2024, the government announced a cap of 270,000 new international student commencements for 2025, citing the need to address migration pressures, housing shortages, and academic integrity concerns. “This measure is necessary to manage population growth, housing affordability and integrity in the student visa system,” said Clare.

 

Why Indian students continue to choose Australia

 

According to University Living’s Research Desk, approximately 17 per cent of international students in Australia in 2024 were from India. Indian students continue to prefer courses linked to direct career outcomes, particularly in engineering, IT, business, and healthcare, fields where Australia faces skill shortages.

 

Graduates are allowed to stay and work for two to four years, depending on their degree, which helps them gain international experience and build professional networks.

 

Economic and social impact

 

“Beyond classrooms, Australia offers a vibrant student life. Cities like Sydney and Melbourne have multicultural communities, and international students support more than 250,000 jobs across education, housing, and hospitality,” said Saurabh Arora, Founder and CEO of University Living. “They also drive much of the demand for student housing, a sector worth around A$10 billion.”

 

“For many Indian students, studying in Australia isn’t just about earning a degree. It’s about finding a place where education, work, and personal growth come together,” Arora told Business Standard.

 

Adjusting to new rules

 

Mamta Shekhawat, Founder of Gradding.com, said, “Australia remains a favourite among Indian students due to its world-ranked universities, industry-aligned courses, and post-study work opportunities. Nevertheless, with the government’s new instruction to keep domestic students in the majority, institutions might adjust intakes or increase entry standards. Indian students need to plan sensibly, applying early, spreading course options, and targeting skill-based courses that match Australia’s labour needs.”

 

She added, “The attraction of Australian study lies in its vocational curriculum, international environment, and open work visa streams. Although tighter enrolment quotas might not directly affect post-study work rights, competition for available places might become fiercer.”

 

“Careful planning, not hurried submissions, will be crucial in negotiating through this changing policy environment,” Shekhawat told Business Standard.

 

Balance, not restriction

 

Arora clarified that Australia’s new rule on keeping domestic students in the majority is not about limiting opportunities for international students. “It’s about restoring balance as enrolments grow and ensuring universities have the capacity to serve both local and international learners well,” he said.

 

“These kinds of adjustments are not new. Australia has reviewed and changed its international education policies several times before, tightening when numbers rise too quickly and easing when universities and industries need skilled graduates. So this should be seen as part of that ongoing cycle, not as a major shift in direction,” Arora added.

 

He also said, “I don’t see this new rule impacting post-study work rights or long-term job prospects, since those are guided by separate visa and employment frameworks. Australia continues to recognise the value of global talent.”

 

Global tightening and student strategy

 

With countries such as the UK, US, and Canada also introducing new limits, Arora advised Indian students to plan ahead. “We’ve seen countries like Australia, the UK, the US, and Canada tighten their student intake and visa rules. For Indian students, this isn’t a setback, it’s a sign to plan smarter. It helps to look beyond traditional destinations and explore newer ones like Germany, France, New Zealand, Ireland, other parts of Europe, and Asia, where policies are more welcoming,” he said.

 

“Building a strong profile matters. Skills, internships, and work experience in areas that are in global demand make applications stronger. Students should apply early, keep track of changing visa rules, and stay flexible with their course and country choices. The real strategy is to stay informed and move quickly. The higher education environment is changing, but opportunity hasn’t disappeared, it’s simply spreading to new places,” Arora explained.