There are more than 400,000 foreign students in Australia A soaring currency, tough visa restrictions and a fear of violence have sharply reduced the flow of foreign students to Australia's colleges and universities. Numbers of international students are down by 10% to their lowest levels since the global financial crisis in 2008.
The Chinese, who are traditionally the largest group, are beginning to stay away and there is a growing lack of enthusiasm among young Indians, South Koreans and Thais.
"There is likely to be a decline in the total number of international students coming to Australia," said Margaret Gardner, vice chancellor and president of RMIT University in Melbourne.
"A decline in those numbers would pose some budgetary challenge for a number of Australian universities because they are a significant part of their overall student income," Prof Gardner added.
There are more than 400,000 foreign students in Australia, making education a 19-billion-Australian-dollar export industry.
Most are from the Asia-Pacific region and because they generally pay higher fees than their domestic counterparts, they help to subsidise the tertiary sector in Australia.
The outlook is particularly grim for the vocational training and English language sectors, where enrolments have dipped by about 20%.
Last year the Labor government made it harder for overseas students to apply for permanent residency.
Immigration officials said the shake-up was designed to "deliver integrity" to a system being roundly abused.
Cowboy colleges were accused of offering, for example, shady hairdressing courses, which would offer young foreigners quick courses and at the end help them to apply for a permanent visa.
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The quality of the graduates the universities are being asked to deliver to the economy will not be as robust as they once were”End Quote Matthew McGowan National Tertiary Education Union "That was a loophole the federal government had to close down, but it has completely over-reacted and is undermining the university sector in Australia," said Stephen King, the dean of the faculty of business and economics at Monash University, where just under half of the 19,000-strong student body is from China, Indonesia, Malaysia and beyond.
"Unfortunately the current Australian government is putting up a big sign effectively saying that we're not really welcoming international students and they are choosing to go elsewhere," Mr King told the BBC news website.
In Canberra, the government has ordered a review of the student-visa programme, which is expected to be completed by the end of the year.
Officials say the international education sector has great economic and diplomatic value to the nation.
There are young foreigners, however, who feel short-changed since the visa rules were altered.
"We do pay a substantial amount more than domestic students and in return we do have certain expectations and when they aren't met or the level of service is changed then we feel we're being taken advantage of," said Robert Acheson, the national president of the Council of International Students Australia.
"We feel we're being put right back into that cash-cow scenario where we're here to pay the bills."
Mr Acheson, a postgraduate law student from Texas, said a series of attacks on young foreigners in Melbourne and Sydney had also dented the country's reputation as a safe place to study.
In the competitive world of international education, Australia's loss is likely to mean more business for colleges in the United States, Canada and the United Kingdom.
Matthew McGowan, national assistant secretary of the National Tertiary Education Union, which represents staff on campus, told the BBC a decline in international student income had made some universities sack workers, which would inevitably dilute the standard of teaching.
"In economic terms, that will mean the quality of the graduates the universities are being asked to deliver to the economy will not be as robust as they once were," he added.
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