After paying a hefty $2000 for a visa application to study in Australia, more than half of all prospective students from parts of northern India and Nepal are being turned down by the Department of Home Affairs. The non-refundable application fee, introduced last July, is the highest in the world and has contributed over $300 million to the federal budget in its first six months. This surge in rejections, occurring in just the past few weeks, threatens the presence of overseas students at some second- and third-tier universities, experts warn.
“It makes Covid-19 look like a walk in the park,” says an industry insider who requested anonymity. “There will be a massive backlash as news of the rejection rates and the number of people who have lost their dough gets around.”
Visa Rejection Rates: A Growing Concern
Official data released on Thursday morning reveals that visa rejection rates in January for Nepal were 50 percent, while for India as a whole, it was 40 percent. However, individuals on the ground report that the rate has increased even more in recent weeks, possibly due to lagged data. In July 2025, the rejection rate for Nepalese applicants was just 8 percent.
Disturbingly, some rejections are based on incorrect information. In one instance, immigration officials referenced a course—a master of business analytics (extension)—not offered by the university to which the student applied. “We are not sure how the Department of Home Affairs is refusing cases referring to programs that don’t exist. It is very distressing for students when they pay $2000 and receive a rejection riddled with inaccuracies,” says one unnamed Australian university official.
“These are the worst visa rejection rates we have ever seen for these regions; it is unprecedented,” adds another source from the tertiary sector. “In an inflationary environment in Australia, this is going to tighten the labor market even more in the second half of 2026. High visa fees and high visa rejections will scare off a lot of students from applying for Australia as an education destination. This has come as a complete surprise to universities.”
Government Response and International Comparisons
Julian Hill, Assistant Minister for International Education, addressed a conference in Canberra on Thursday morning, attributing the increase in visa refusals to an “unsustainable spike in non-genuine students from some parts of South Asia.” Hill dismissed conspiracy theories suggesting government policy as the cause.
Australia’s visa application fee is significantly higher than those of competitor nations. In Australian dollar terms, the United Kingdom charges $1007, Canada $155, the United States $262, and New Zealand $633. Professor George Williams, Vice-Chancellor of Western Sydney University, notes a direct link between the $2000 visa fee and students’ reluctance to study in Australia, especially from price-sensitive markets.
“It’s a major deterrent for students to study here, especially from price-sensitive markets, such as a student in the Philippines who wants to study nursing,” Williams says. “The fee is excessive compared to other markets and makes our education system less attractive.”
Impact on the English-Language Sector
While universities grapple with the effects of the non-refundable fee and high visa rejections, the English-language sector is experiencing a downturn. The English Language Intensive Courses for Overseas Students (ELICOS) have seen applications plummet since the fee’s introduction. Federal data shows applications dropped to just 9822 in the six months after July 1, compared to 26,381 during the same period in 2024.
Ian Aird, Chief Executive of English Australia, says the sector is reeling, with numerous colleges downsizing or closing. “Our estimate is that approximately 40 percent of ELICOS providers have downsized campuses or closed a campus, closed all ELICOS operations, or closed operations altogether,” Aird reports.
Future Implications and Policy Considerations
Education insiders accuse the Labor government of unethical behavior by not refunding at least part of the fee if an application is unsuccessful. They are also concerned about potential policy directions under a Coalition government, which may revisit past migration policies allowing overseas students to bypass study for work opportunities.
Parliamentary Budget Office costings from before last year’s federal election suggest that a Coalition government could re-enact policies that previously led to an influx of non-genuine students. Phil Honeywood, CEO of the International Education Association of Australia, warns that such policies could again tarnish Australia’s reputation as a quality study destination.
“Morrison’s unlimited work rights policy led to a flood of non-genuine students coming to our country just to earn Australian dollars and send the money back home,” Honeywood says. “This totally dumbed down Australia’s reputation as a world-class study destination.”
As the debate over immigration and international students continues, the Coalition’s stance remains unclear. Shadow Home Affairs Minister Senator Jonno Duniam emphasizes the need for balanced migration settings, considering the capacity of housing and infrastructure. Meanwhile, education remains a significant export sector for Australia, contributing nearly $54 billion in 2024/25, according to the Australian Bureau of Statistics.
The future of Australia’s international education sector hangs in the balance as policymakers and educational institutions navigate these complex challenges. The coming months will reveal whether adjustments to visa policies can restore confidence among prospective students and maintain Australia’s standing as a leading destination for international education.
