Can India Offset China as a Source for International Students Amid U.S.-China Tensions?
Key Takeaways
Enrollments of Chinese overseas students in the United States have fallen since the pandemic, creating revenue shortfalls for many higher education institutions and limiting exchange ties at a critical geopolitical moment. In the meantime, overseas Indian student enrollments are above pre-pandemic levels.
While our research shows that the United States remains a top choice for Chinese students, the tense U.S.-China political relationship is now the single most common reason Chinese adults say they wouldn’t recommend studying in the United States.
The U.S. elections will determine the magnitude, but not the directionality, of the negative shift in the U.S.-China relationship, in turn influencing the ability and desire of Chinese students to study in America.
U.S. institutions which are not already looking to leverage recovering enrollment from other countries to help diversify their student bodies and de-risk from an overreliance on China should do so. Those which are already doing so are in large part looking to India. Our data suggests this makes sense.
In appealing to Indian students, schools should focus on highlighting educational quality and future employment potential, especially relative to other popular destinations like Canada and the U.K. Specific actions they can take on this front include highlighting well-performing career centers, past student outcomes, and relationships with employers who sponsor visas. Credibly addressing safety concerns — which remain an area of worry for many Indian students — will be key to supporting successful diversification efforts.
International students contribute roughly $40 billion to U.S. universities each year, and are particularly important as a source of revenue for non-elite U.S. institutions. Among them, Indian and Chinese students make up over half of incoming foreign enrollments at U.S. universities, with Chinese students consistently forming the largest group until early last year. Before the COVID-19 pandemic, China and India were also both growing markets for U.S. education, with the number of students from each steadily increasing year on year.
Demand for U.S. higher education remains strong in both markets: The United States is the most popular destination for study abroad among Chinese and Indian adults, both according to data on where students are studying, and based on our own survey data asking friends and family members of international students where they would most recommend studying abroad.
The United States is the most-recommended study abroad destination among Chinese and Indian respondents
The pandemic pressed pause
The pandemic temporarily halted the growth of foreign student enrollment in the United States, with the 2020-2021 academic year seeing double-digit declines in overall foreign enrollment at U.S. colleges and universities, including enrollments of Chinese and Indian students. Most sending countries have seen rebounds. Indian students, for example, are now enrolled at higher numbers than the pre-pandemic 2019-2020 academic year. But Chinese students have returned more slowly, initially due to longer and more stringent COVID lockdowns at home, but increasingly due to geopolitical tensions.
Chinese students stopped coming during COVID, but stayed away due to geopolitics
When we first surveyed Chinese adults in July 2023 on their overseas education preferences, the primary reason for not recommending study in the United States was the lack of career opportunities, followed by its distance from China. The latter may have loomed particularly large in the immediate post-COVID period, when many overseas students were unable to travel to or from their host countries for months due to lockdowns. Now, however, the primary reason Chinese adults who don’t recommend the United States as a destination give is concern over political considerations, i.e. the U.S.-China relationship.
Poor U.S.-China relations and safety concerns are dampening Chinese interest in studying in America despite advantages
Exchanges are seen as a way to lessen U.S.-China tensions, but less so than a year ago
Equally concerning, Chinese adults may be losing faith that international exchange can decrease tensions. Compared to one year ago, the share of Chinese adults who think that international study can improve U.S.-China relations has declined by 6 percentage points. That share has mostly moved to being unsure whether it helps, or otherwise to believe that it has no effect.
Chinese adults’ faith in educational exchanges to improve bilateral relations with America is waning
U.S. elections and U.S.-China relations
Our U.S.-China “fear gauge” consistently shows more hawkish attitudes among Republican adults toward China on military, economic and policy dimensions, mirroring perceptions of Congressional Republicans compared with Congressional Democrats. This leads us to believe that a second Trump administration come 2025 would find a particularly receptive audience for more hawkish policies on China, and we would expect the contraction of Chinese students studying in the United States to accelerate accordingly.
U.S.-China Fear Gauge: Trends by demographic
But the question is largely one of degree. Public expectations of escalating tensions vis-à-vis China are bipartisan, with a majority of Americans expressing expectations of increased tensions in the future. Furthermore, expectations for increased tensions are higher for economic matters compared with military ones.
U.S. and Chinese adults expect economic tensions to escalate
Amid this general hawkishness toward China, we expect heightened scrutiny of Chinese students looking to study advanced STEM degrees or take part in research exchanges in fields designated as critical and emerging, regardless of who wins the White House.
Universities managing sensitive research programs and recruiting top tech talent in these domains are therefore the most exposed. But given Chinese adults’ trepidation around the political relationship in general when considering study abroad, we expect the lack of a high-level rapprochement under either administration will preclude a return to pre-pandemic study trends.
Another reason for fewer Chinese university students enrolling in U.S. institutions is less political. With the Chinese economy faltering, fewer students will be able to afford to study overseas, and a U.S. degree is the world’s most expensive.
India to the rescue?
This is why many U.S. universities are looking to India as a possible replacement revenue source for international students. There is merit in this approach. In contrast to China, geopolitical concerns do not factor into reasons for or against recommending study in the United States (see chart below). Instead, Indian students emphasize the quality of a U.S. education as their top consideration, followed closely by the ability to obtain a job in their field post-graduation. While prestige is American higher ed’s calling card, quality and employment potentially rate even higher among Indian students, highlighting an easy opportunity for student engagement beyond the most elite U.S. institutions.
On the negative side of the ledger, Indian respondents point to the high cost of living and tuition as the top drawback of a U.S. education. Emphasizing opportunities to work in the United States for a fixed amount of time after graduation, such as through optional practical training (OPT), can address this. America’s distance from India is also a concern. While schools cannot change geography, emphasizing flight connections or the ability (if possible) to pursue hybrid degrees is one avenue for mitigating this downside.
Indian adults cite cost and safety as their top reasons for not recommending study in the United States
Schools should address safety concerns head on
Similar to Chinese students, concerns over safety loom large among Indian adults. Educating potential students and their families about school-specific geographic and environmental advantages and risks vis-a-vis safety, and explicitly providing information on institutions’ risk mitigation efforts, can go a long way toward making all overseas students feel more comfortable relocating to the United States.
Surprisingly, Indian adults ding Canada for safety and the bilateral political relationship. This curious result almost certainly stems from a June 2023 diplomatic dispute where the Canadian government accused the Indian government of assassinating a Sikh dissident on Canadian soil. We saw this event strongly reflected in Indian sentiment toward Canada in other data series.
Competing for talent with other top destinations
The Canada example is a good reminder that students are making study abroad decisions based on multiple complex dimensions across several competing countries. And all is fair in the global war for talent.
In 2022, the UK instituted a policy ito grant visas and work permits to graduates from a list of top schools of any nationality. More schools on the list are in the United States than anywhere else. And Canada has piloted visa policies which explicitly sought to exploit inefficiencies in the U.S. H1B visa program. On the opposite side of the ledger, the United Kingdom also recently enacted a policy prohibiting students from bringing dependents on their student visas, something that disproportionately discourages graduate students. And Australia and Canada have instituted new numeric caps on student visas. A portion of the students who would have gone to these top destinations may now be considering the United States instead. Avoiding policy “own goals” can help the United States look relatively more competitive absent significant changes.
Policy levers in the world of the second best
A more comprehensive overhaul of the U.S. immigration system to place a higher premium on skills and education would of course be a major improvement in the policy environment for attracting top talent. But given the recent congressional track record, the likelihood of comprehensive immigration reform anytime in the near future is vanishingly small.
But there is still an opportunity for U.S. higher education to become relatively more attractive to qualified students. Maintaining OPT, including the additional year for certified STEM degrees, as well as making H1B visas available to the highest-qualified graduates while making sure they are not used for wage arbitrage, are key policy levers that schools can advocate for. Institutions should also invest in their career offices and relationships with employers who sponsor visas post-graduation, and should release statistics specific to international student employment post-graduation, while ramping up messaging surrounding student safety to help mitigate concerns on that front.
Sonnet Frisbie is the deputy head of political intelligence and leads Morning Consult’s geopolitical risk offering for Europe, the Middle East and Africa. Prior to joining Morning Consult, Sonnet spent over a decade at the U.S. State Department specializing in issues at the intersection of economics, commerce and political risk in Iraq, Central Europe and sub-Saharan Africa. She holds an MPP from the University of Chicago.
Follow her on Twitter @sonnetfrisbie. Interested in connecting with Sonnet to discuss her analysis or for a media engagement or speaking opportunity? Email [email protected].