100,000 Indian students contribute Rs.12,500 crores to the US economy

In these times of recession, Indian students contributed Rs.12,500 crores (USD 2.75 billion) to the US economy in the form of tuition and living expenses. To put in perspective, total budget of Indian department of higher education for 2008-09 was 10,800 crores.

India continues to be the leading place of origin for the eighth consecutive year with more than 100,000 students enrolled in the US higher education institutions for the academic year 2008-09, according to the latest report by IIE Open Doors. Every sixth international student enrolled in US higher education institutions is from India. Enrollment of Indian students had been growing at a rate faster than the total enrollment of all international students (see table).

Much of this growth has come from two levels:
1. OPT
2. Undergraduate

3,000 more students enrolled at OPT…

Total number of international students enrolled on OPT has increased by 17.3% from 56,766 to 66,601 in 2008-09. This is a result of the new rule issued in April 2008 that allowed students with a degree in science, technology, engineering, or mathematics to extend the duration of OPT from 12 to 29 months. This has clearly resulted in 3,000 more Indian students enrolled in OPT in 2008-09 as compared to the previous year.

Undergraduate is the new growth area…

Nearly 725 more Indian students are enrolled at the undergraduate level as compared to 3,300 lesser students enrolled at the graduate level (see table above). This may be a function of the characteristics and funding sources of the undergraduate students as compared to the graduate students. Graduate students are mostly seek financial support from the university or take a bank loan. Given the concerns of slowdown and recession some graduate students would have put their plans on hold. In contrast, most undergraduate students come from the top of the socioeconomic pyramid and are funded by their families.

Likely drop in number of Indian students for 2009-10

It is expected that the growth of Indian students on US campuses may take a sharp U-turn for the academic year 2009-10. Number of F-1 student visas issued for the period Oct’08-Sept’09 have decreased by 25%. Likewise, recent survey from the Council of Graduate Studies reports 16% drop in the first-time enrollment of Indian students in fall’09.

It is important to note that IIE Open Doors numbers are based on a comprehensive survey of 3,000 institutions across levels and types for the previous academic year (2008/09) as compared to Council of Graduate Schools which reports numbers from current academic year (2009/10) but surveys a smaller sample of graduate schools (257 graduate institutions responded in Phase-III).