How education was a key part of the India–EU FTA

How education was a key part of the India–EU FTA Premium

The signing of the India-European Union (EU) Free Trade Agreement (FTA) on January 27, 2026, has been hailed as the “mother of all deals,” primarily for its multi-billion dollar impact on goods and services. However, for the first time in an Indian trade pact, higher education was put on centre stage. This deal opens up numerous opportunities for internationalisation of Indian Higher Educational Institutions (HEIs), particularly in the backdrop of the recent adverse changes in immigration policies of U.S., Canada, and Australia. This article analyses the emerging opportunities and challenges faced and also presents strategic imperatives for Indian HEIs to succeed in the new world order .

One of the most important aspects of the FTA concerns the mobility and migration of students aspiring to pursue higher studies abroad. The EU has committed to an uncapped student mobility offering multi-year, multi-entry visas for Indian students. In addition, it offers a three-year post-study work permit to enable integration of graduates into the European job market. The deal proposes to open a one-stop hub in New Delhi to enable visa fast tracking for 27 different countries of the EU, with a mandate to process 90% of student and researcher applications within 30 days.

By securing a framework for Social Security Agreements within five years, the deal ensures that Indian graduates and researchers can work across the EU, without losing pension or healthcare benefits in case of a break in service.

In order to leverage the FTA, HEIs may adopt a two-pronged internationalisation model that blends academic mobility with research integration. They can offer dual degrees, leveraging the newly established guidelines for Mutual Recognition of Qualifications (MRQ). The HEIs must align their internal credits to the European Credit Transfer System (ECTS). Students can complete their foundational years in India and pursue their final year in the EU, receiving degrees from both the institutions followed by guaranteed three-year post-study work permits.

The FTA allows European universities to set up physical or hybrid hubs in India. In line with the Niti Aayog's suggestion, Indian HEIs may invite mid-tier European universities to set up hubs on their campuses in areas like AI/Semiconductors, sharing labs and faculty while leveraging the FTA's investment protections.

Horizon Europe is a €100 billion research funding opportunity with focus on six clusters: digital, industry & space; climate, energy & mobility; health; food & bio-economy; culture & inclusive society and civil security. Indian HEIs can offer their campuses as living labs for European research in fields like green tech, AI, and tropical medicine, areas where India offers scalable opportunities for testing. HEIs can now lead research consortia under Horizon Europe, provided the consortium includes at least one partner from an EU country and two from other associated countries.

Currently, EU-headquartered Multi-National Companies (MNCs) like Bosch, Ericsson, SAP, and Siemens account for about 15% Global Capability Centres (GCCs) in India. There is immense potential for Indian HEIs to partner with more MNCs from EU to set up “co-innovation labs” in emerging technology areas.

As per the written reply by Government in the Rajya Sabha on December 4, 2025, over 1.88 million Indians are currently studying abroad, out of which 1.25 million were enrolled in Higher Educational Institutions. It is a marginal decline of 5.7% from 1.33 million in 2024. The largest destination for studies in 2025 was Canada (34%), followed by U.S. ( 20%), U.K. (14%), and Australia(11%).

The major attraction for Indian students to go to U.S. for higher studies has been the opportunity for the graduates in a Science, Technology, Engineering, and Mathematics (STEM) field to opt for the paid Optional Practical Training (OPT) in a U.S. organisation upto 12 months, which can be extended for additional 24 months. There is a proposal to eliminate or curtail this provision, which hurts the students financially. The recent changes in immigration policies of the U.S. have been delaying the visa processing times. This, coupled with the proposed increase in H-1B sponsorship fees for employers to $100,000, resulted in a massive 44% drop in issuance of U.S. student visas, in the first half of 2025.

Following the diplomatic challenges in the last two years and the consequent changes in visa regulations, the study permits issued by Canada to Indians nosedived from about 150,000 in the first eight months of 2023 to less than 10,000 in the same period in 2025, a steep fall of over 90% in last two years.

With the costs of studying going up, students are looking for destinations with reduced costs, coupled with stability of immigration policies.

While U.S. is tightening pathways, the India-EU FTA mandates uncapped mobility and fast-track 30-day visa processing for students and skilled workers. The cost of quality higher education in European nations like Germany and France is substantially less compared to U.S. This advantage combined with welcoming visa policies for students to work and explore local job markets after graduation presents an attractive proposition.

Due to the altered scenario, the year 2025 already saw a 20% increase in enrolments of Indian students in Germany, followed by 17% increase in France. India-EU FTA is expected to accelerate this trend in the years to come.

While the opportunities are vast, the challenges are rooted in regulatory alignment. Indian HEIs must now comply with the EU's GDPR Act, which is crucial for seamless research collaboration and student data exchange. European partners will engage in deep research only if the Indian university can comply with the data protection standards that mirror the EU's GDPR.

The EU's Carbon Border Adjustment Mechanism (CBAM) will increase demand for green skills. Indian universities must rapidly update curricula to include EU-standard sustainability certifications.

Though most of the EU countries are increasingly adopting English also as a medium of instruction, Indian faculty must be trained in intercultural pedagogy to attract European students, who may utilise the FTA's mobility clauses to study in India in topics of their interest like Indian knowledge systems and traditional medicine. In order to ease the language and cultural barriers, German, French, or Spanish may be introduced as electives by Indian HEIs by partnering with organisations like the Max Mueller Bhavan, Alliance Française.

A number of Indian HEIs like IIT Madras have the successful track record of working with the partners in EU on a range of research and consulting projects. Government of India, Department of Science and Technology in association with Horizon Europe established “Living Labs” in India to pilot European green hydrogen catalysts. A number of Indian scholars are pursuing joint Master Degrees with EU universities with the benefits of full scholarships and multi-country residency.

While the FTA is transformative, it is not a magic bullet. Despite the restrictions, U.S. Ivy League brands still carry global prestige and public perception in India, which most of European public universities have not yet reached.

Recent policy shifts in the U.S. have fundamentally altered the value proposition of a U.S. degree for Indian students. The recent India-EU FTA is a timely initiative by the Indian government. It can be leveraged to redraw the global landscape for Indian Higher Education Institutions (HEIs) and accelerate the pace of internationalisation in the years to come. However, it calls for a major cultural adaptation on the part of the HEIs and the students in order to reap the dividends successfully.

(Prof. O.R.S. Rao is the Chancellor of the ICFAI University, Sikkim. Views are personal.)

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Published - February 03, 2026 04:41 pm IST

Europe / higher education

Source: TheHindu
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