Rupee Depreciation Drives Up Overseas Education Costs for Indian Students
The ongoing depreciation of the Indian rupee is significantly impacting the affordability of higher education abroad for middle-class Indian households. According to education consultants, this financial pressure is compelling many students to postpone their study plans by one to two years, opt for shorter-duration courses, or even consider enrolling in local institutions instead of pursuing undergraduate programs overseas.
Substantial Cost Increases and Budget Squeezes
Arnav Kumar, co-founder of the study abroad platform Leap, highlighted that the total cost for popular courses has surged by approximately Rs 3.5 to 4 lakh over the past year. This increase is straining family budgets and escalating the projected financial burden. Kumar emphasized that this situation is likely to intensify competition for scholarships as students seek alternative funding sources.
Piyush Kumar, regional director for South Asia, Canada, and Latin America at IDP Education, noted that Indian students are adapting by deferring their plans or developing robust financial strategies involving loans and scholarships. Most students prefer taking education loans from Indian banks, which are sanctioned in rupees based on current exchange rates. While foreign bank loans are an option, they often require a local co-signer or collateral, making them less accessible for many.
Currency Weakness and Inflation Compound Expenses
Data from ETIG reveals that the rupee has depreciated by 4.9% against the US dollar, nearly 2.5% against the euro, and 3.3% against the pound so far this year. In the fiscal year 2024-25, the rupee has weakened by about 5% to 6% against the US dollar. When combined with global tuition inflation, the actual cost increase in rupee terms ranges from 7% to 11% annually.
Pankaj Kapoor, assistant professor at the School of Commerce, NMIMS, explained that in absolute terms, students may now be paying Rs 5 lakh to 10 lakh more per year compared to 2023, depending on the program and country. He pointed out that middle-class households are particularly affected, as long-term savings are increasingly diverted toward covering these rising education expenses.
Shift in Student Preferences and Market Trends
Study abroad consultant Meenal Damani observed an overall dip in the number of students choosing to study abroad this year compared to the previous year. Many are now opting for European destinations over the United States due to cost considerations. Damani noted that while job uncertainty persists globally, limited options for specialized master's programs in India continue to drive students overseas, albeit with a stronger focus on return on investment (ROI) rather than prestigious university brands.
Akshay Chaturvedi, founder and CEO of Leverage Edu, added that students are aligning remittances more deliberately with fee milestones and selecting loan structures for predictability over multi-year horizons. There is also a growing trend of Indian students exploring non-traditional markets such as Germany, Italy, France, Ireland, and other parts of continental Europe, where education costs may be more manageable.
In summary, the rupee's depreciation is reshaping the landscape of overseas education for Indian students, prompting strategic adjustments in timing, destination choices, and financial planning to navigate these challenging economic conditions.
