International student visa applications to Australia have plunged by more than a third with growing fears the sector will take up to five years to recover.

Federal government figures reveal student visa applications from China are down by 20 per cent and 33.5 per cent overall for the 2019-2020 financial year. Applications from Nepal dropped 61 per cent and those from India by 47 per cent, putting further pressure on Australia’s $40 billion a year international student sector amid COVID-19 restrictions.

Smaller universities and private Vocational Education and Training (VET) providers expect to be hardest hit because of their greater reliance on students from India and Nepal.

Larger institutions including the University of Technology and University of NSW are more reliant on students from China.

Emeritus Professor Frank Larkins from the Melbourne Centre for the Study of Higher Education at The University of Melbourne said there was usually a 12-to 18-month lag between a student applying for a visa and arriving. “This really is quite serious,” he said.

“What we are seeing happening now is going to affect universities in 2021 and 2022”.

Professor Larkins, who has also released a new report showing more than half the funding for university research comes from international students, said it could take universities up to five years to recover.

A spokeswoman for the University of NSW said “numbers reflected by the Department of Home Affairs are in line with the decrease in overseas applications for international students at UNSW Sydney in 2020”.

She said the university welcomed the federal government’s announcement this month that it will resume the processing of offshore student visa applications.

A spokeswoman for Charles Sturt University said it was concerned about the changes in international student visa applications “as one of the flow on impacts of the COVID-19 pandemic” which the international student market may not fully recover from until 2025.

Professor Alex Frino, deputy vice-chancellor (global strategy) at Wollongong University said the drop in numbers was a result of the government’s decision to shut offshore visa processing.

“Underlying demand is still strong for study in Australia but … we can’t access the market and the market can’t access us,” he said.

University of Technology Sydney deputy vice-chancellor Iain Watt said there had been a reduction in applications before the pandemic hit after five years of growth.

“There was a minor correction under way before COVID had an impact,” he said.

“Our applications for visas would be where they were last year.”

Universities Australia chief executive Catriona Jackson said the drop was to be expected during the pandemic.

International Education Association of Australia chief executive Phil Honeywood said the government figures meant Australia was at risk of losing international students to the UK and Canada which had open borders.

“The particular concern is the massive drop in student applications from the subcontinent and this might well be because of the constrained post-study work right opportunities now available to overseas students,” he said.

Independent Tertiary Education Council of Australia chief executive Troy Williams said the outlook for the VET sector was particularly “grim” because many of its students were from India and Nepal and there was “no realistic prospect of a full-scale return of international students in 2021”.

Minister for Education Dan Tehan said planning is “well under way on conditions that will allow for the return of international students”.

“Preconditions to this happening include the reopening of internal state and territory borders within Australia, as well as the return to on-campus learning for the benefit of domestic students and the international students who are already in Australia,” he said.

“Robust health, quarantine, border and provider protocols also need to be in place.”
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