Rupee Weakness Hits Indian Students Abroad
MUMBAI: The recent depreciation of the Indian rupee has created significant challenges for Indian students studying overseas. In just six months, the rupee has fallen by approximately 5%, now standing at 87.2 against the dollar. This decline has raised the financial burden on students and their families, particularly as countries like the UK and Canada tighten post-education work visa regulations, further complicating their ability to repay educational loans.
Financial Strain on Students
The weakening rupee has escalated the cost of education for Indian students abroad. For instance, a tuition and expenses budget of ₹1 crore has now increased by ₹5 lakh due to the currency drop. Ajay Bohora, co-founder of HDFC Credila, an education loan company, highlighted that students previously relied on post-education work visas to earn in dollars and manage their loan repayments. With the total cost of education in the US exceeding ₹1.5 crore for many undergraduate students, the financial implications are severe. This situation may lead to longer repayment periods or increased equated monthly installments (EMIs) for education loans.
Moreover, the rising costs extend to everyday expenses. Sudha Pai, a parent from Mumbai, shared her experience of sending $800 monthly for her daughter’s living expenses in the US, down from $900. She also pointed out the additional burden of the Tax Collected at Source (TCS), which further complicates financial planning for families.
Visa Regulations Add to Challenges
In addition to currency fluctuations, tightening visa regulations in key study destinations are exacerbating the situation for Indian students. The UK has proposed that international graduates must secure graduate-level jobs with salaries ranging from £36,000 to £40,000 to remain in the country beyond two years. Similarly, Canada is tightening its immigration policies, including the cancellation of permits and the discontinuation of the Student Direct Stream visa program.
K P Singh, an education counselor, noted that these changes, combined with the political uncertainty in the wake of elections, have significantly impacted overseas education prospects for Indian students. The tightening of work visa norms is seen as a form of “economic patriotism” in countries like the US, UK, and Canada, which may limit opportunities for international students.
Strategic Financial Planning for Students
In light of these challenges, career counselor Karan Gupta advises parents to consider locking in foreign exchange rates by securing loans early and transferring funds to university accounts. This strategy could help mitigate the impact of further rupee depreciation. Gupta also recommends that students avoid foreign currency loans, as these could become more expensive to repay upon returning to India. Instead, students should seek universities that offer financial aid and scholarships to lessen their financial burden.
Singh encourages students to explore emerging fields such as GenAI, cybersecurity, and blockchain, rather than focusing solely on traditional areas like coding. He cautions that students without sufficient financial resources should carefully evaluate the potential return on investment for their chosen courses to avoid taking unnecessary risks.
The combination of a weak rupee and stringent visa regulations presents a daunting challenge for Indian students pursuing education abroad. As families navigate these financial hurdles, strategic planning and informed decision-making will be crucial for managing the costs associated with overseas education.
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