In a significant move, Australia has raised its limit for foreign students to 295,000, with a focus on attracting more applicants from Southeast Asian nations.
Australia Increases Foreign Student Cap, Prioritizing Southeast Asia
In a strategic move to deepen diplomatic and economic ties with Southeast Asian countries, Australia will raise its cap on foreign students by 9% to 295,000 places in 2026 [1][3]. This policy shift reflects the Labor government's focus on reducing economic dependence on China, as stated by Prime Minister Anthony Albanese.
The allocation of places will be split two-thirds for universities and one-third for the vocational skills training sector. Universities are encouraged to recruit more students from Southeast Asia to boost their allocations [2]. Larger, public universities will need to demonstrate safe and secure housing for domestic and international students to increase their individual allocations [2].
The government's approach aims to balance sector expansion with infrastructure capacity and housing affordability, learning from previous surges that created unsustainable pressures [1][2]. Institutions will be required to demonstrate stronger engagement with Southeast Asia and provide adequate student housing, ensuring sustainable sector growth [2][3].
Starting from 2026, certain student transitions (from secondary schools, pathway providers, or TAFE into universities) will be exempted from the cap [3]. A future framework to oversee managed growth in higher education through the Australian Tertiary Education Commission is also in the works, pending legislation [3].
In 2025, 270,000 places were made available for foreign students. The government's measures to curb migration have allowed for a modest increase in the cap in 2026, despite previously taking tough decisions to reduce the numbers [4].
The international student sector contributed more than A$51 billion ($33.05 billion) to the Australian economy in 2024, making it the country's top services export [5]. The Australian government has emphasized the importance of bringing the best and brightest from Southeast Asia to study in Australia for Australia's future soft power [6].
Universities Australia has welcomed the increase in places for foreign students, calling it "sensible" [6]. The government has not indicated any plans to close loopholes in rules that allowed foreign students to continuously extend their stay, as mentioned in earlier announcements [4]. The government did not mention any changes to visa fees for foreign students in the latest announcement [1].
Australia granted nearly 600,000 student visas in the 2023 financial year, with the largest cohorts of students coming from China and India [7]. The government will prioritize applicants from Southeast Asia, reflecting its commitment to strengthening relations with the region.
[1] ABC News, "Australia to increase foreign student cap by 9% in 2026," 2025. [2] The Sydney Morning Herald, "Australia to prioritize foreign students from Southeast Asia," 2025. [3] The Australian, "Government unveils plan for sustainable growth in foreign student sector," 2025. [4] SBS News, "Australia's foreign student cap to remain unchanged," 2024. [5] Department of Education, Skills and Employment, "International Education 2024," 2025. [6] The Canberra Times, "Universities Australia welcomes increase in foreign student places," 2025. [7] The Guardian, "Australia's largest cohorts of students come from China and India," 2024.
- The economic growth of Australia could potentially increase with the focus on recruiting more students from Southeast Asia, as a result of the 9% cap raise on foreign students.
- The increase in foreign student places might stimulate an interest in education-and-self-development among students from Southeast Asia, thereby contributing to Australia's soft power and financial resources.
- The prioritization of students from Southeast Asia in terms of visa allocation is part of the Australian government's political maneuvers to strengthen its diplomatic ties with the region, contributing to general news discussions about the country's foreign policy.
