Nepali Students Emigration has become a national issue. Foreign studies used to be a luxury service. Today, it is accessible to even low and middle class households. Nepalese society seems to be concerned about foreign studies in recent years as the number of outgoing students is alarming. There is a general narrative that Nepal is losing youth who are future human capital and hence the driver of economic growth. Much of the discussion on Nepalese student migration is not evidence-based. This blog aims to fill that gap.

Status Quo of Nepali Student Migration

No Objection Certificate (NOC) is a commonly used parameter to find the number of Nepali students moving abroad for studies. NOC is granted for the self-financed Nepalese students for study abroad which is required by the banks to send tuition fees to their foreign universities.

Figure 1 shows the historical trend of the No Objection Certificate (NOC) issued by the Ministry of Education, Science and Technology (MoEST). 

The number of NOC issued from fiscal year 2056/57 to 2064/65 is retrieved from Nepal Education in Figures 2009 At-A-Glance (p.22). Similarly, the number of NOC issued from fiscal year 2065/66 to 2077/78 is retrieved from Educational Information 2078 (p.87). Likewise, the number of NOC issued from fiscal year 2078/79 to 2080/81 is requested from MoEST using the Right to Information (RTI) application. 

Figure 1 shows the historical trend of NOC issued from Fiscal year 2056/57 to 2080/81.  It also includes the three major events to provide some historical context. On 15 Jestha 2065, Nepal was declared a Federal Democratic Republic (FDR), ending 240 years old monarchical rule (Ministry of Foreign Affairs, n.d.). As shown in figure 1, the number of students going abroad decreased for a few years after Nepal became FDR. Similarly, Nepal was hit with a 7.8 magnitude great earthquake in Baisakh 2072. Figure 1 shows the increase in outflow of Nepali students post earthquake. Likewise, the number of Nepali students decreased sharply during the COVID-19 pandemic which skyrocketed in the fiscal year 2078/79 as depicted in figure 1. 

The number of NOC issued overestimates the number of Nepali students going abroad because not all the students who received NOC go abroad due to reasons such as visa rejection. Also, a single student can apply for more than 1 NOC in a given year if he or she decides to change their college or universities. The Department of Immigration publishes departure statistics based on the purpose of visit. The number of departures for study purposes would be a better metric to find the annual number of Nepali students going for foreign studies.

Similarly, Figure 2 shows the amount of money Nepali students send to foreign educational institutes from the fiscal year 2072/73 to 2080/81. In the last fiscal year 2080/81, Nepali students spent $940.8 Million on foreign education which is around 2.2% of the Nominal GDP (NRB, 2024). Nepal Budget 2080/81 increased the tax rate on the transfer of tuition fees to foreign educational institutions from 2% to 3% (Packer, 2023). The Nepal government collected 3% of  $940.8 Million which is around $28 Million as a tax revenue in the fiscal year 2080/81 alone.

Reliable data on the number of Nepali students returning to Nepal after their graduation are not available. There is a general intuition that many Nepali students choose to stay in foreign countries after their graduation. Similarly, there is little record of the remittance sent by Nepali students. Nepal Rastra Bank (NRB) publishes data on the amount of remittances but the contribution of  Nepali students is unknown. It is difficult to distinguish the amount of remittance sent by migrant workers, non-residents nepali or nepali students. Therefore, there is not enough evidence to claim that Nepal is truly losing young minds and capital.

Benefits of Sending Nepali Student Abroad

We will now shed some light on research on the positive impact of international student migration on the sending country. 

1. Wells (2014) pointed out that there is no scientific research that shows a country loses human capital from outflow of its students to foreign countries (p.22).

2. Bergerhoff et al. (2013) used a Lucas growth model to show that international student migration increases the steady state economic growth rate of both host and origin country by 0.013 percentage points on average. This shows international student migration is not a zero sum game where one country loses and the other gains. It is in fact a positive sum game where both origin and host country benefits. 

3. Similarly, Rasamoelison et al. (2021) found statistically significant positive effects of student migration on GDP per capita of sending countries. They showed that a 10% increase in the number of students emigrating to English-speaking countries leads to 0.25% increase in real GDP per capita (p.12). In addition, they found that an increase in student outflow to English-speaking countries increases interest in politics and democratic political systems in the source countries (p.13). 

4. Likewise, Krannich (2023) found that international students transfer development-related knowledge to their origin countries by returning to their home country or forming a transnational social network from the host country. 

5.  Also, Outgoing student migration increases as a country develops and then decreases after a certain development threshold is reached (Weber & Van, 2023. p.15). They observed the inverted U-shaped curve after 2007, using the Human Development Index (HDI) as a proxy of development.

Generally, such research findings do not appear in the discussion of nepali students' migration. Based on these research, current Nepali student migration does not seem to be problematic for the sending countries. However, the next section covers some policy recommendations to manage the student emigration.

Policies to Manage Nepali Student's Migration

Sending countries can implement three categories of policies to manage student emigration (Gribble, 2008, p.28). They are policies to retain, return and engage students. Ziguras & Gribble (2015) pointed out Singapore successfully used the combination of these three categories of policies to deal with its brain drain. Even though Singapore has a strong economy, state of art research and development facilities and top quality educational institutes, they are also suffering from outgoing student migration( Ziguras & Gribble, 2015, p.249).  This section discusses each category of the policies in brief with specific policy recommendations.

1. Policies to Retain

The Nepal government should have a clear understanding on the factors causing student emigration backed by evidence-based research. Then, they should develop and implement appropriate policies accordingly. There are push-pull factors that facilitate international student migration. Push factors are those factors that discourage the students to stay in their home countries. It includes factors such as low-quality education institutions, low job prospects , unavailability of certain courses and poor living standards. On the other hand, Pull factors are those factors that attract the students towards the host countries. It includes factors such as high-quality educational institutions, high earning potentials, scholarships opportunities, favorable migration policies and high prospect of relocation. If the pull factors of host countries are more significant than push factors of Nepal in facilitating the Nepalese student emigration, policy responses from the Nepal government won’t bring substantial impact. 

There are three major policies that can retain students in Nepal. First, the Nepal government can improve the quality of domestic tertiary education by setting a target and then allocating subsidies to universities to achieve that target. For example, Japan started the Top Global University (TGU) project in 2014 to improve the internationalization and competitiveness of Japanese universities (Sato, 2022, p.102). Under this project, 37 Japanese universities were selected through a competitive process who received JPY 7.7 billion subsidy per year from 2014 to 2023 (H Steven, 2016, p.93). They clearly set the target that 13 universities out of these 37 universities will aim to be in the World's Top 100 universities ranking by 2024. The remaining universities will drive the internationalization of Japanese society. Nepal should also initiate such projects and subsidize universities based on their performance metrics of university ranking. 

Second, the Nepal government can encourage domestic educational institutions for cross-border provisions such as creating joint programmes with foreign educational institutes and partnering for university-level student exchange programs. For example, Duke Kunshan University in China is a joint venture between Duke University and Wuhan University. Yale-NUS in Singapore is another joint venture between Yale University and National University of Singapore. 

Third, the Nepal government can encourage foreign universities to open their satellite campuses in Nepal. Some of the examples of satellite campuses include Georgetown University’s Qatar campus, New York University's UAE campus, and Monash University’s Malaysia campus. In 2002, Singapore launched the Global Schoolhouse Initiative that aimed to bring 10 top-ranked foreign universities in the next 10 years (Ziguras & Gribble, 2015, p.249). Cross-border provision and satellite campuses can cater the unmet demand of Nepali students which can retain them in Nepal. In the case of Nepal, we can encourage Indian Engineering Institutes such as IIT and NIT to open their branch campus in Nepal. 

2. Policies to Return

The Nepal government can also develop policies that encourage Nepali students to return home after their graduation. Policies can target to encourage Nepali students to return for a few years or permanently. When Nepali students return home with foreign degree, they are more likely to come with valuable knowledge and skills that can be channeled towards economic growth and development of Nepal.

The first return policy can be simplifying the process for getting equivalence certificates of the foreign degree.  Last year, Tribhuvan University simplified the process amid criticism and struggles faced by foreign educated nepali students(Rauniyar, 2023). Aastha Dahal, who holds MPhil and PhD from the University of Cambridge, had to wait more than two years to get her equivalence certificate (Dahal, 2023). The equivalence certificate is required to apply for jobs in the private and public sector in Nepal. The foreign educated students come home with high expectations. If they have to struggle like Aastha, they will be discouraged to come back. Thus, even a minor policy response like this can give students hope.

The second return policy can be incentivizing foreign educated youth to return home by providing them subsidized loans. The Nepal government provides subsidized loans under 10 different categories (NRB, 2018, p.5) . There is provision of project based subsidized loans for youth returned from foreign employment. Under this provision, up to 1 million NPR loan at subsidized interest rates can be provided. However, it is provided only to those who have worked in foreign country for at least 6 months. It should be amended and also cover the youths coming to Nepal directly after their graduation. Such youths can now receive subsidized loans under the educated youth loan category which requires the equivalence certificate of the foreign degree and the original certificates as a collateral. However, they can receive only up to 0.7 million NPR loans at subsidized interest rates. The government should also increase the size of the subsidized loan for its effectiveness.

The third return policy can be initiating a government funded scholarship scheme that requires Nepali students to return home after their graduation. For example, the Indian National Overseas Scholarship scheme funds Indian students from low-income households to study Masters and Phd abroad. After they graduate, students have to return to India and stay in India for at least one year (Ministry of Social Justice and Foreign Empowerment, 2024). The Nepal government can also promote other aid agencies that follow similar conditions. For example,the UK’s government Chevening Scholarship requires Nepali students to return home for at least 2 years after their graduation. However, such scholarships can also be ineffective if the students on government scholarships do not return after their graduation. In late 1990s, many top Singaporean students who went to prestigious foreign universities on government scholarships broke the contract and did not return to Singapore ( Ziguras & Gribble, 2015, p.249). There should be severe penalties if the scholarship contract is broken. In addition, government scholarship funded students might come to their home country for a contract period and leave the country later. 

The fourth return policy can be the organizing of "घर फर्क" annual events at the Nepalese embassies in foreign countries. Such events should provide free authentic Nepalese food, patriotic messages and also present the potential opportunities in Nepal. They should also share the support available to them from the government. This will act as a nudge to the Nepali students who are thinking of returning.

3. Policies to Engage

The third category of policies to manage outgoing Nepali student migration is to engage them while they stay in foreign countries. They are human capital for the host country, but they can still contribute to the economic and social development of their origin countries. For example, Milan Jung Katuwal, a Nepalese student in the USA,  founded nepal-based National Policy Forum (NPF) and heads the organization while physically staying in the USA.   Similarly, Nishchal Banskota, a former student in the USA, runs Nepal Tea Collectives in the USA with the mission to lift one million Nepali tea farmers out of poverty by selling their organic tea to consumers around the world. This shows despite the person’s physical location, he or she can make a contribution to the economic, social and cultural development of their home countries. Specht (2022) found that international student migration increases trade between the host country and student’s home country. She pointed out that student migration can promote trust between institutionally distant countries.In addition, Krannich and Hunger (2022) found that not only student return migration, but also their remains and curricular migration can contribute to their home countries' development. 

The first policy to engage diaspora is to establish and maintain diaspora social networks. Through such channels, diaspora can develop the connection with home, transfer their knowledge and skills and also collaborate with people at home. For example, The Great Nepali Diaspora is a great initiation to create a diaspora social network. The Nepal government should collaborate with TGND to facilitate the skills and knowledge transfer, connection and collaboration effectively.

The second policy is to encourage diaspora to remit their foreign earnings back home. Government should encourage banking and financial institutions to make the remittance process smoother and faster. Government can even subsidize the service charge for the remittance transfer.

Conclusion

We don't have enough evidence to assess the seriousness of the current Nepali student migration. Similarly, the research findings on potential benefits of outgoing student migration is often ignored. However, this blog covered three categories of policies to manage Nepali student migration. They were policies to retain, return and engage the Nepali students. Specific policy recommendations were also presented under each category. These policy responses might not be effective if they are developed without knowing the seriousness and the cause of the problem.

References

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