The Great Collapse of US Higher Education: Implications for Indian Students and the Global Education System

The United States has long been a beacon for higher education, attracting millions of international students, including a significant number from India. In the 2023-24 academic year, over 330,000 Indian students enrolled in US institutions, making India the top source of international students in the US. However, recent developments suggest that the US higher education system is facing a profound crisis, often referred to as the “great collapse.” This article explores the dimensions of this collapse, its specific implications for Indian students, and its broader impact on the global education system, with a focus on the Indian perspective.

The Great Collapse of US Higher Education

The US higher education system is grappling with multiple challenges that threaten its stability and global reputation:

  1. Enrollment Declines: College enrollments in the US peaked in 2010 but have been declining steadily since, driven by rising tuition costs, the COVID-19 pandemic, and shifting perceptions about the value of a college degree. For instance, West Virginia University reported a drop from 29,000 students in 2017 to under 26,000 in 2023, accompanied by a $45 million budget deficit.
  2. Budget Cuts and Program Closures: Financial pressures have led to significant budget cuts, particularly in liberal arts and social sciences. Sonoma State University faces a $24 million shortfall, threatening 22 majors and over 100 faculty positions. Similarly, West Virginia University cut 28 majors, including all foreign language programs, in 2023. These cuts disproportionately affect programs less aligned with immediate job market demands, reducing academic diversity.
  3. Visa Restrictions and Policy Shifts: Recent US immigration policies have created uncertainty for international students. Reports indicate that nearly 50% of visa cancellations reported by the American Immigration Lawyers Association in April 2025 involved Indian students. Proposals to scrap the Optional Practical Training (OPT) program, which allows international students to work in the US post-graduation, further jeopardize their prospects. Such policies have led to a projected 20-25% drop in Indian student applications to US universities.
  4. Cultural and Political Tensions: The US higher education landscape has been rocked by culture wars, anti-DEI (Diversity, Equity, Inclusion) initiatives, and crackdowns on campus protests. These factors create a less welcoming environment for international students, particularly those from diverse backgrounds.
  5. Rising Costs and Questionable ROI: The cost of US higher education has skyrocketed, with tuition at top institutions often exceeding $60,000 per year. For Indian students, this is comparable to or higher than fees at top Indian institutions like the IITs, which have also increased in recent years. Many Indian students now question the return on investment (ROI) of a US degree, especially with uncertain job prospects in the US.

These factors collectively signal a systemic crisis that undermines the US’s position as the premier destination for higher education.

Implications for Indian Students

Indian students, who form a significant portion of the US’s international student population, are uniquely affected by this collapse:

  1. Disrupted Academic Plans: Visa cancellations and restrictive policies disrupt the academic and career plans of Indian students. For example, the potential elimination of OPT could leave over 300,000 Indian students without post-study work opportunities, forcing them to return to India or seek alternatives elsewhere. This is particularly concerning for STEM students, who dominate Indian enrollments and rely on OPT to gain work experience in the US.
  2. Financial Risks: The high cost of US education, often funded through loans or family savings, becomes riskier when job prospects are uncertain. Indian families, who view education as a pathway to socioeconomic mobility, may face significant financial strain if graduates cannot secure employment in the US or elsewhere.
  3. Shift to Alternative Destinations: As the US becomes less attractive, Indian students are increasingly exploring other countries. Canada, Australia, the UK, and Germany have seen surges in Indian student enrollments. For instance, Canada welcomed 226,450 Indian students in 2022, surpassing China as the top source of international students. Germany’s waiver of tuition fees for Indian students and Australia’s post-study work opportunities are drawing students away from the US.
  4. Impact on Aspirations: The US has historically symbolized opportunity and academic excellence for Indian students. The current crisis, coupled with harassment and visa uncertainties, risks dampening these aspirations. Social media posts on X reflect frustration, with some users warning that US degrees are becoming a “scam” due to bleak job prospects. This could lead to a broader disillusionment with international education among Indian youth.
  5. Brain Drain vs. Brain Gain: While the US’s loss could be India’s gain, as skilled graduates return home, India’s job market may struggle to absorb the influx of returnees. The Indian higher education system, despite its growth, faces challenges like outdated curricula and limited research opportunities, which may not fully utilize the skills of US-educated graduates.

Impact on the Global Education System

The collapse of US higher education reverberates across the global education landscape, reshaping student flows, institutional competition, and economic dynamics:

  1. Redistribution of International Students: As Indian and other international students turn away from the US, countries like Canada, Australia, and the UK are poised to benefit. The UK saw a 273% increase in Indian student visas from 2019 to 2022, while Australia granted over 43,400 student visas to Indians in the first half of 2022-23. This shift strengthens the higher education systems of these countries, boosting their economies through tuition fees and student spending.
  2. Economic Consequences for the US: International students contribute significantly to the US economy, with Indian students alone spending an estimated $75 billion annually on education and related expenses. A projected loss of $375 billion over five years, as suggested by some X users, could cripple US universities, many of which rely on international tuition to offset budget deficits. This may lead to further program cuts and institutional closures, exacerbating the collapse.
  3. Rise of Indian Higher Education: The challenges in the US present an opportunity for India to strengthen its higher education system. Initiatives like the National Education Policy (NEP) 2020 aim to double the Gross Enrollment Ratio (GER) and position 50 Indian institutions among the top 1000 globally by 2030. Private universities like Ashoka and Krea, modeled on liberal arts principles, are attracting students who might otherwise have studied abroad. However, India must address issues like faculty shortages, outdated curricula, and low research output to compete globally.
  4. Global Competition and Innovation: The redistribution of talent and resources is fostering competition among global education hubs. Countries like Germany and Singapore are investing in infrastructure and incentives to attract international students, while India’s EdTech sector is booming, offering digital alternatives to traditional education. This competition could drive innovation but also risks widening the digital and urban-rural divides in countries like India.
  5. Cultural and Diplomatic Shifts: The decline of US higher education may weaken its soft power, as fewer international students experience American culture and values. Meanwhile, countries like Canada and Australia are strengthening ties with India through education, potentially influencing diplomatic and economic relations.

Opportunities and Challenges for India

For Indian students and policymakers, the US higher education crisis presents both opportunities and challenges:

  • Opportunities:
    • Strengthening Domestic Institutions: India can capitalize on the return of talent by investing in world-class universities and research facilities. The NEP’s focus on multidisciplinary education and international collaborations is a step in this direction.
    • EdTech Growth: India’s EdTech sector, valued at $2.1 billion in 2022, can provide affordable, scalable education solutions, reducing reliance on foreign degrees.
    • Global Leadership: By addressing its educational challenges, India can emerge as a global education hub, attracting students from South Asia and beyond.
  • Challenges:
    • Infrastructure and Quality: India’s higher education system, with over 1,000 universities and 42,000 colleges, struggles with quality, infrastructure, and employability. Only 18.43% of engineering graduates and 5% of other graduates are deemed employable.
    • Digital Divide: The shift to online education, accelerated by COVID-19, highlighted disparities in internet access, with only 23.8% of Indian households having internet in 2017-18.
    • Policy Implementation: Ambitious reforms like NEP and EQUIP require robust funding and execution to achieve their goals.

Recommendations for Indian Students and Policymakers

  1. For Students:
    • Diversify Study Destinations: Explore countries like Canada, Australia, and Germany, which offer quality education, post-study work opportunities, and welcoming environments.
    • Evaluate ROI: Consider the financial and career implications of studying abroad versus pursuing quality programs in India, such as those at IITs, IIMs, or emerging private universities.
    • Leverage EdTech: Utilize online platforms for skill development and certifications, which can complement formal education and enhance employability.
  2. For Policymakers:
    • Invest in Quality: Increase funding for faculty development, research infrastructure, and modern curricula to make Indian institutions globally competitive.
    • Bridge the Digital Divide: Expand internet access and digital literacy programs to ensure equitable access to education, especially in rural areas.
    • Foster International Collaborations: Encourage partnerships with foreign universities to bring global expertise to India, as envisioned in the Foreign Education Providers Bill.
    • Promote Employability: Align curricula with industry needs and integrate digital skills training, as suggested by initiatives like ICDL.

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