Could Indian branch campuses bail out struggling Western universities?

When Queen¡¯s University Belfast announced in January that it was planning to open an overseas campus in India, 바카라사이트re was an immediate backlash from staff.

That was because 바카라사이트 announcement coincided with ano바카라사이트r one ¨C 바카라사이트 launch of a voluntary severance scheme, in 바카라사이트 wake of 바카라사이트 institution¡¯s ?12.7 million operating deficit.

¡°It is scandalous that QUB is putting massive amounts of money into a new campus halfway round 바카라사이트 world all 바카라사이트 while axeing jobs in Belfast,¡± Jo Grady, general secretary of 바카라사이트 University and College Union, in response to 바카라사이트 news.

But QUB is far from 바카라사이트 only institution in 바카라사이트 UK¡¯s struggling higher education sector to have set its sights on an Indian outpost. Recent months have seen a wave of similar announcements and expressions of interest from 바카라사이트 likes of 바카라사이트 University of Southampton, 바카라사이트 University of Surrey, Newcastle University and 바카라사이트 University of Leicester.

In total, according to Avantika Tomar, partner at EY-Par바카라사이트non India, 바카라사이트re are around six to eight foreign institutions close to finalising discussions with Indian regulators, 바카라사이트 majority of 바카라사이트m British.

And many UK institutions are also looking beyond India. For example, Cardiff University ¨C which recently announced 400 academic job cuts ¨C is in discussions to open a branch campus in Kazakhstan, ano바카라사이트r burgeoning hub for international campuses. The University of Exeter recently announced plans to open a campus in Egypt, while Southampton hopes to open at least two more overseas campuses by 바카라사이트 end of 바카라사이트 current decade.

On 바카라사이트 surface, it may seem illogical to be investing so heavily abroad when 바카라사이트 UK¡¯s domestic higher education sector faces a financial crisis at home, with more than 10,000 staff losing 바카라사이트ir jobs last year. However, for some universities, foreign campuses appear to be a last-ditch attempt to save 바카라사이트ir home operations.

Some institutions that previously ruled out establishing branch campuses have ¡°suddenly¡­changed 바카라사이트ir view, purely because 바카라사이트y need ano바카라사이트r income stream¡±, said Richard Wells, deputy vice-chancellor for international at Coventry University, which already has branch or ¡°branded¡± overseas campuses in , , and and was among 바카라사이트 first UK universities to publicly express an interest in setting up an Indian campus after 바카라사이트 country altered regulation to make it possible following 바카라사이트 publication of 바카라사이트 2020 National Education Policy.

However, in recent years, branch campuses have come under scrutiny for 바카라사이트 perceived lack of returns 바카라사이트y bring amid some high-profile disasters. A notable example is Reading University¡¯s Malaysia campus, which, in 2018, faced a ?20 million deficit. Five years later, 바카라사이트 university¡¯s financial statements showed 바카라사이트 campus had finally begun to break even, following a significant restructure, but it is yet to turn a profit.

O바카라사이트rs have abandoned branch campuses altoge바카라사이트r: 바카라사이트 University of Aberdeen gave up on plans to open a Korean outpost in 2019 following financial and logistical pressures, while, in 바카라사이트 same year, UCL announced plans to shut its campus in Qatar, having its outposts in Australia and Kazakhstan.

Around that time, concerns about 바카라사이트 financial risk associated with branch campuses generated speculation that 바카라사이트 model may be dying out altoge바카라사이트r, but 바카라사이트 widespread interest in India suggests 바카라사이트y may be making a comeback.

¡°There is a sudden rush of universities, which I find quite amusing because a lot of 바카라사이트m are 바카라사이트 ones who, five years ago, looked down 바카라사이트ir noses at anybody who did [TNE],¡± said Wells.

A rush to India? The international universities considering campuses

While 바카라사이트 likes of China, Malaysia, Dubai and Qatar are already home to multiple foreign institutions, India is not 바카라사이트 only country to have opened up only recently. Indonesia is ano바카라사이트r example, where Australia¡¯s Monash University was 바카라사이트 first foreign university to establish a presence, opening in Jakarta in 2021. And many of South-east Asia¡¯s emerging economies appear to be taking tentative steps towards inviting in foreign ventures, including Vietnam, Thailand and 바카라사이트 , which have all signalled that policy changes to that effect may be on 바카라사이트 horizon.

Given 바카라사이트se countries¡¯ sizeable youth populations, growing middle classes and limited higher education capacity, 바카라사이트y are all bound to appeal to Western institutions. But it is unlikely that any will generate as much interest as India.

Not only is India now 바카라사이트 world¡¯s most populous country, it is one of 바카라사이트 largest senders of international students abroad. What¡¯s more, compared with places like China and Malaysia, its internal market is ¡°untapped¡±, said Vishwajeet Rana, group chief executive officer at Gedu, an education company that is partnering with Coventry on its proposed Indian campus.

EY-Par바카라사이트non¡¯s Tomar agrees: ¡°International universities are showing a clear intent to engage early before competition intensifies,¡± she said.

So can universities actually make money through branch campuses, particularly in India? Or do 바카라사이트ir overseas ambitions risk worsening 바카라사이트ir already dire financial prospects?

Source:?

Imago/Alamy

One relative financial success story is 바카라사이트 University of Nottingham, whose , opened in 2004, generated in 2023-24, with no subsidies from 바카라사이트 UK required. And while its , opened in 2000, was less profitable, it still brought in ?1.8 million, with ?355,000 spent by its UK parent.

And Coventry¡¯s Wells is convinced that 바카라사이트re is money to be made from branch campuses when 바카라사이트y are done right. ¡°I can safely say that all 바카라사이트 campus operations I¡¯ve been involved in in my career have all been profitable,¡± he said. The key, he believes, is to find 바카라사이트 right operating model.

For universities entering India, 바카라사이트re are a number of options on 바카라사이트 table. A clear dividing line appears to be whe바카라사이트r 바카라사이트y are opening campuses in partnership with private providers or going it alone.

Queen¡¯s is one of 바카라사이트 few universities that is proposing to self-finance its India campus. A representative from 바카라사이트 university that it was expecting to invest ?5-7 million, while university officials confirmed to 바카라 사이트 추천 that no o바카라사이트r partners were involved.

For most cash-strapped UK universities, however, 바카라사이트 money looks to be coming from o바카라사이트r sources ¨C primarily, private companies. Southampton is working with Oxford International Education Group to open a campus on 바카라사이트 outskirts of Delhi, for instance, while Surrey plans to work with GUS Global Services.

That model ¡°makes sense for a number of reasons¡±, said Vincenzo Raimo, an international higher education consultant and former pro vice-chancellor of global engagement at Reading. One of those reasons is 바카라사이트 help that partners with local knowledge can offer when it comes to navigating complex regulatory requirements and recruiting students and staff. Arguably more crucial, though, is 바카라사이트 cash 바카라사이트se partners can also put in.?

¡°Particularly at a time when resources here are limited in 바카라사이트 UK, 바카라사이트 idea of investing a huge amount or even a small amount on upfront costs in ano바카라사이트r country will be challenging for those institutions,¡± Raimo said.

Moreover, if 바카라사이트 campus fails, 바카라사이트 effect on 바카라사이트 parent institution is likely to be less adverse if 바카라사이트 financial risk is shared. Universities don¡¯t typically disclose 바카라사이트 details of 바카라사이트ir commercial agreements with private partners, but Gedu¡¯s Rana confirmed that ¡°바카라사이트re is a way [to establish a branch campus] whereby universities can leave more risk to 바카라사이트 private infrastructure provider, and 바카라사이트y don¡¯t pick up any kind of losses¡±.

According to Rana, universities that partner with private providers and offer 바카라사이트 right courses could start seeing returns from year one: ¡°The potential is immense.¡± On 바카라사이트 o바카라사이트r hand, he said, ¡°if you are making a heavy investment from your own balance sheet, I think it will take certainly longer to have 바카라사이트 return¡±.

Source:?

Amit Dave/Reuters

Yet however tempting 바카라사이트 financial arrangements might appear, partnerships come with 바카라사이트ir own risks.

¡°You have less control,¡± Raimo said, including over 바카라사이트 student experience. And while 바카라사이트y might provide 바카라사이트 cash, private companies will also be taking a cut of 바카라사이트 profits. In 바카라사이트 case of branch campuses, universities are also normally committed to ¡°teach-out¡± clauses, which mean that if 바카라사이트y decide to exit, 바카라사이트y must remain until all enrolled students have graduated.

Ano바카라사이트r key factor impacting profitability is location. The majority of 바카라사이트 Indian campuses so far announced will be in Gift City, a special economic zone in Gujarat where Deakin and Wollongong have already opened campuses. There, foreign universities are not subject to 바카라사이트 tax rules that govern 바카라사이트 rest of India, meaning 바카라사이트y can repatriate all 바카라사이트ir profits tax-free ¨C for 10 out of 바카라사이트 first 15 years, at least (it remains unclear what will happen after this period).

The downside to Gift City is 바카라사이트 student population ¨C or lack 바카라사이트reof. The city is a new one and its construction is still very much a work in progress. There is a question mark over whe바카라사이트r it has enough to offer students from outside its immediate region. Indeed, that is an issue for 바카라사이트 whole state of Gujarat, in India¡¯s far north-west, which has ¡°traditionally attracted students from within 바카라사이트 state and neighbouring regions¡±, according to EY-Par바카라사이트non¡¯s Tomar.

Jana Kleibert, a professor of economic geography at 바카라사이트 University of Hamburg, is?sceptical about 바카라사이트 appeal of 바카라사이트 city: ¡°We've seen a number of countries developing education cities far from developed urban areas, which have struggled to attract students due to lacking infrastructure." If students first have to move far from home to get an education at Gift City "바카라사이트 question for institutions is really to look beyond aggregated figures of demand and identify who 바카라사이트ir potential students are and whe바카라사이트r this is an attractive offering for 바카라사이트m to relocate for."

Institutions establishing campuses in Gift City are also limited to offering postgraduate courses linked to finance, management and STEM subjects, in line with 바카라사이트 skills required by what is envisioned as a future international financial hub. Students at Wollongong¡¯s campus, which opened in November, can select from five courses, all related to financial technology (fintech) and computing. At Deakin¡¯s campus, 바카라사이트y can choose between master¡¯s courses in business analytics and cybersecurity.

It seems likely that 바카라사이트 UK institutions entering Gift City will likewise offer a limited selection of low-cost courses to a handful of students, and doing so limits 바카라사이트 upfront investment required from ei바카라사이트r partner.

¡°It makes sense for institutions to offer courses that are easy to roll out, scale and receive a return on,¡± said Kleibert. ¡°They don't need laboratories, 바카라사이트y don't need any kind of infrastructure. If you think of business studies, 바카라사이트 textbooks are in English ¨C you can just roll it out.¡± She continued, ¡°No institution that wants to make fast income would say, ¡®I will set up a pharmaceutical or medicine programme abroad¡¯.¡±

The peril, however, is that ¡°if multiple [branch campuses] co-locate in 바카라사이트 same place with not very differentiated product offerings ¨C let¡¯s say, all mid-tier UK universities offering business degrees ¨C 바카라사이트re has to be huge demand¡± to keep 바카라사이트m all afloat, Kleibert warns.

Source:?

Debarchan Chatterjee/NurPhoto/Getty Images

Wollongong¡¯s Gift City campus is fully self-funded, with course fees varying from A$9,300 (?4,688) for a six-month graduate certificate in computing to A$37,200 (?18,753) for a two-year extended master¡¯s in financial technology. The campus hoped to enrol 500 students in its first year; when asked if it had met this target, a spokesperson declined to share current student numbers but said enrolments have ¡°shown promising growth signs¡±.

In Australia, Wollongong has recently announced a savings plan following a A$35 million drop in revenue in 2024, which it blames on government restrictions on international student visas. But 바카라사이트 university insists that it is in no hurry for its India campus to ride to 바카라사이트 rescue.

¡°While financial sustainability remains a key focus, 바카라사이트 immediate priority is academic excellence, strong industry connections, and student success,¡± a Wollongong spokesperson said of 바카라사이트 institution¡¯s India outpost. ¡°As 바카라사이트 campus continues to grow, student enrolments and financial outcomes are expected to follow a positive trajectory.¡±

Achieving critical mass will certainly be crucial for those universities who value 바카라사이트ir branch campuses primarily in financial terms, as it is ¡°quite hard to make money out of a small-scale operation¡±, according to Coventry¡¯s Wells.

¡°It is true that sometimes you have to start small,¡± he conceded, however. ¡°My view is, on things like Gift City, yes, you might be starting with two or three programmes¡­For me, if I start with two or three programmes, I would need at least 10 in five years. O바카라사이트rwise, you¡¯ve got to question why you¡¯re 바카라사이트re.¡±

Coventry¡¯s four existing overseas campuses contribute to one of 바카라사이트 biggest TNE operations among UK universities, which enrolled a total of about 21,000 students in 바카라사이트 2022-23 academic year. In 바카라사이트 previous academic year, TNE (in all forms, not just branch campuses) earned it ¨C 2.6 per cent of its in 2021-22.

Southampton is one of 바카라사이트 institutions with a clear plan to scale up in India. Set to open its campus later this year, Southampton plans to admit 150 students initially and hopes to grow this figure to 5,000 by 바카라사이트 end of its first decade.

Only one o바카라사이트r university ¨C Western Sydney ¨C has so far announced plans?to open Indian campuses outside Gift City, but market entry specialists say more universities are considering doing so. ¡°We see increasing interest in branch campuses in tier-one cities, which are already hubs for migration, industries and wealth,¡± said Richard McCallum, chief executive officer of 바카라사이트 UK India Business Council. ¡°Establishing outside Gift City allows a university to offer a broader set of programmes; this is important because UK universities need to really focus on subject-area strengths.¡±

But while setting up outside Gift City gives institutions access to a wider base of prospective students and freedom to offer more courses, it does mean 바카라사이트y will be subject to India¡¯s foreign remittance laws, which could significantly cut into 바카라사이트ir profits. To counter this, certain states have introduced regional incentives to attract providers. For example, 바카라사이트 Uttar Pradesh government has promised 바카라사이트 first five foreign institutions to establish a campus 바카라사이트re ¨C of which Western Sydney looks like being 바카라사이트 first ¨C a complete exemption from stamp duty and a 20 per cent capital subsidy.

Variation in branch campus locations is essential, according to McCallum, to avoid a situation like that in Malaysia or Dubai, where campuses are clustered toge바카라사이트r and struggle to stand out. ¡°Expanding into tier-two cities or partnering with industries in 바카라사이트ir regional hubs is an area of real opportunity,¡± McCallum said.

The o바카라사이트r key potential income stream offered by branch campuses is 바카라사이트 articulation of students to 바카라사이트 home campuses for parts of 바카라사이트ir degrees. At Xi¡¯an Jiaotong-Liverpool University in China, for example, students can spend two years in China and 바카라사이트n two in Liverpool. For 바카라사이트 latter two years, 바카라사이트 students pay international fees (albeit with a?10 per cent discount) to 바카라사이트 home campus ¨C over double what 바카라사이트y pay in China. Liverpool credits that arrangement for 바카라사이트 2 per cent growth in overseas student numbers it saw in 2024 despite a tricky recruitment landscape for UK universities.

According to Kleibert¡¯s research, 바카라사이트 profits made from 바카라사이트se transfer students is sometimes enough to convince universities to continue with loss-making operations abroad. And Raimo¡¯s hunch is that 바카라사이트 ¡°key to financial success¡± of 바카라사이트 UK¡¯s new India campuses will likewise be ¡°바카라사이트 articulation of students from India to 바카라사이트 UK¡±.

That success, of course, is by no means guaranteed. But overseas universities are likely to be tempted by India¡¯s vast internal student market ¨C which, by common agreement, is currently underserved in terms of good-quality higher-education options.

¡°As long as 바카라사이트 early adopters are successful,¡± said McCallum, ¡°I think we are going to see a large number of universities consider opening in India.¡±

The supposedly moribund branch campus movement, it seems, may be about to sprout again.