Raghuram Rajan, former RBI Governor and economist, has cautioned that the Trump administration’s restrictions on international student visas and actions targeting US universities could have serious negative consequences—not only for the United States but for global higher education as a whole. He described these moves as “unfortunate,” highlighting how they disrupt the deep academic and economic ties that have long existed between the US and countries like India.
Rajan emphasized that international students represent a significant export for the US, bringing in about $45 billion annually, a portion of which is contributed by Indian students. Indian students have greatly benefited from US education, gaining skills and global exposure, while American universities have also profited from their presence, creating a mutually beneficial relationship.
However, with the current chill in US policy, Rajan warned that many students are reconsidering their options and may turn to other countries such as Australia or the UK, which appear more welcoming. This could hurt the US in the long run, as students seek alternatives offering better opportunities and a friendlier environment.
Rather than seeing this as just a setback, Rajan believes India has a rare opportunity to capitalize on the situation. He urged India to invest more heavily in its own education system, particularly in its premier universities, to elevate them to a global standard. He pointed to China’s impressive progress in higher education and research over the past two decades as a model India should emulate to secure its place in global research and development.
Regarding the pushback against Trump’s policies, Rajan noted that universities like Harvard are fighting vigorously, but this conflict creates uncertainty, with students and research projects becoming “collateral damage.” He shared an anecdote about a university leader in Singapore who observed a dramatic increase in acceptance rates for US academic offers—from 40% to 100%—reflecting a weakening US academic pull.
Rajan also addressed India’s broader economic context, stressing that while the country’s GDP growth of 6.5% in FY25 and 7.4% in the last quarter is impressive, it’s still insufficient for India’s ambitious goal to become a “Viksit Desh” by 2047. He called for higher, sustained growth rates of 8 to 9%, underpinned by deeper structural reforms.
Ultimately, Rajan sees education as a potential “dark horse” driver of India’s future growth and global standing. He believes India’s moment has come but turning this into lasting progress requires sustained investment and inclusive growth, with education playing a pivotal role in that journey.
