Currency and visa woes hit students’ study-abroad plans

The Indian rupee touched an all-time low against the United States dollar this week, raising concerns for students looking to study abroad in the US, as it raises their financial commitments, including through additional loans.

Some say they may have to choose a country where education is relatively cheaper, though concerns are emerging over visa delays in a large number of countries in Europe as well as Canada and Australia.

This week, the rupee reached record lows against the dollar, breaching the psychological 80-rupee level against the US currency on 19 July, pushing study-abroad costs much higher than two to three years ago just as study-abroad plans are returning to normal after the pandemic. Now, the additional financial burden is proving to be a deterrent.

About 60% of Indian students heading abroad for studies go to the US.

The dollar has strengthened against most major currencies in the past month. But India’s Minister of State (Junior Minister) for Finance Pankaj Chaudhary told the upper house of parliament, the Rajya Sabha, on 19 July that global factors such as the Russia-Ukraine conflict and soaring crude oil prices were the major factors for the weakening of the Indian rupee. The rupee has depreciated about 7% against the US dollar since the beginning of 2022.

Experts and students said that the concerns are genuine and aspiring students – and even those already in the US – will have to arrange for additional funds.

According to experts, roughly half of Indian students studying abroad finance their studies through education loans, mainly from commercial and national banks, and many will not have the capacity to arrange additional funds. They could face a lot of hardship.

Delhi resident Ajay Shukla’s son plans to head to the US for higher studies. Shukla said that “due to the continuous fall in the rupee, he will have to arrange an additional Rs300,000 [about US$3,756] to Rs400,000 this year to meet tuition fees, living and other expenses in the US.”

Nancy Tiwari is looking forward to starting her masters course in the US. However, the weakening of the Indian rupee has meant her financial planning has “gone haywire”.

“Everything, including tuition fees, living expenses and travel tickets, has become costlier because of exchange-rate volatility,” she said. “We have taken a loan from a bank to meet the cost of my studies in America. But with the dip in the rupee, we shall have to take an additional loan now.”

Change of plans

The depreciation of the rupee has not been as severe against other major currencies such as the euro, the British pound and the Japanese yen, so many students may change their plans and, instead, proceed to the UK or Europe for higher studies.

But education consultants are quite optimistic that, despite the plunging rupee being an issue, students will not abandon their plans to study abroad.

Sumeet Jain, co-founder of Yocket, a Delhi-based study-abroad consultancy, said that, at this point, he did not see this as a major concern, and students were unlikely to cancel their plans.

“Of course, the falling rupee is increasing costs, but most students and parents can manage it. Also, the prospect of earning back in dollars makes it a very attractive proposition,” Jain told University World News, referring to students’ ability to work while abroad.

Maria Mathai, director of education consultancy MM Advisory Services said: “While the plunging rupee is causing worry to students, in our estimation most students are proceeding with their plans to study abroad and have no intention of delaying further.”

“Due to pandemic-induced restrictions, many had to postpone their plans in 2019, 2020 and 2021. Now that global conditions have stabilised, they can’t wait to go to their dream destinations, even if it comes at a higher cost,” she told University World News.

She added: “A majority of undergraduate students tend to be self-funded (by parents or family) and postgraduate students tend to be an equal mix of self-funded and those who access funds either from university (scholarships) or financial institutions (loans). In the past decade, some start-ups have entered the industry and so, for the first time, students have more options to finance their education beyond national banks.”

Visa issues add to anxiety

According to Mathai, students are worried about the uncertainty around their visa status, even more than the plunging rupee.

“The top destination country for Indian students, Canada, has a huge backlog of applications. USA, at number two, is positioned a bit better, but students are scrambling to get appointment slots. They are booking slots in any city that has availability,” she said.

Mathai noted that visa issuing agencies in the US, Canada and Europe are short staffed, pointing to the experiences of a student in France and another who is going to The Netherlands – both received e-mails from the respective countries’ departments informing them of delays due to staff shortages.

“One of my students going to Canada who has a scholarship was refused a visa,” she said.

For students, it is like being between a rock and a hard place – long processing times or inexplicable refusals. Either way, it is a highly stressful experience for them.

Vivek Jain, chief business officer at study-abroad platform told University World News: “Students are concerned about visa delays. The fluctuation in the value of the rupee is also a major reason for anxiety. While the rupee has depreciated against the US dollar, it has appreciated against the euro. Meanwhile, we are hopeful that student visas will get priority in processing.”

Experts say there is little possibility of the rupee strengthening against the US dollar in the near future.

The Higher Education Abroad report released last year by consulting firm RedSeer estimated the number of Indian students going abroad for higher studies rose from 440,000 in 2016 to 770,000 in 2019 and is likely to increase further to about 1.8 million by 2024.

The US, Canada, Australia and the UK are the preferred destinations for Indian students.