MUMBAI: India’s outward remittances for education abroad fell 24% year-on-year to around $0.32 billion in August 2025, compared to $0.42 billion in August 2024. The figure was the lowest for August since 2017, a month that typically sees higher remittances at the start of the academic season in the US.“The 24% decline in remittances to education shows how closely India’s foreign exchange outflows are linked to a complex mix of global policy, economic and behavioral changes that shape India’s outward currency flows,” said Pavan Kavad, MD of currency exchange firm Prithvi Exchange (India) Ltd.Education-related expenditure, one of the largest components of the liberalized cash transfer program after travel, is losing steam, even taking into account pocket money that falls under the category of ‘maintenance of immediate relatives’.
Remittances are seeing a steady decline after peaking at $2.3 billion in 2021
From $787.8 million in 2017, remittances rose to $1.95 billion in 2019, before the pandemic reduced them to $1.12 billion in 2020. The 2021 lockdown recovery ($2.37 billion) proved short-lived. Since then, the shift has remained stable.“Stricter visa standards in top study destinations such as the US, UK and Canada have had a direct impact on the timing and volume of remittances to education,” Kavad added. “Many students face higher denial rates or lengthy processing, forcing families to defer or defer payments.”Education consultant Karan Gupta said a shift is happening. “Those headed for diploma courses or secondary universities abroad are pulling out as returns on investment no longer stack up,” he said. Another advisor, Pratibha Jain, said that when “the US closes its doors to our students, they will not go to other countries but stay here at home.” She added that India’s own universities now offer “a range of courses, many of which are comparable to those of the world”, prompting more students to stay behind for undergraduate studies and look abroad only for postgraduate programs.However, Gupta pointed out that top performers continue to apply abroad in record numbers. “The number of admissions has doubled or even tripled in some cases,” he said. “What we are seeing now is not just fewer students going abroad – it is a recalibration of the expectations, priorities and financial decisions of both families and institutions.”With annual education costs soaring – CAD30,000 in Canada, £22,000 in Britain – and a weakening rupee, families are also turning to cheaper alternatives abroad, such as Australia and New Zealand, which offer simpler visa rules and a lower cost of living.“Many parents have become increasingly cautious,” says Kavad. “They are opting for partial payments or splitting remittances to manage currency volatility and uncertainties in foreign admission timelines. The moderation of education-related outflows is not just about fewer students going abroad – it reflects a more cautious and strategic approach to foreign spending.”
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