The recent depreciation of the Indian rupee against the US dollar has cast a shadow over the aspirations of Indian students planning to study in the United States. Over the past year, the rupee has weakened by nearly 5%, increasing the financial burden on families funding overseas education. Despite intervention by the Reserve Bank of India (RBI) to stabilize the currency, including selling billions of dollars to strengthen the rupee, its value remains under pressure. As of February 2025, the rupee trades at approximately ₹86.63 per dollar, compared to ₹83.75 six months ago.
This decline has significant implications for Indian students studying abroad, as tuition fees, living expenses, and other costs are typically paid in US dollars. Even minor fluctuations in exchange rates can inflate annual expenses by several lakhs of rupees. For instance, experts estimate that the total cost of studying in the US may rise by as much as ₹3.7 lakh annually due to currency depreciation. This increase is particularly challenging for middle-class families, whose financial planning may be disrupted.
The weakening rupee acts as a form of “hidden inflation” for students. Even if universities do not increase tuition fees, Indian students end up paying more in INR terms because of unfavorable exchange rates. Students relying on education loans face an additional burden, as loan sizes grow to cover rising costs, leading to higher debt obligations.
Several factors have contributed to the rupee’s decline. A strong US dollar, driven by the Federal Reserve’s cautious approach to interest rate cuts and global trade uncertainties, has placed pressure on emerging market currencies like the rupee. Additionally, India’s rising gold imports and a widening current account deficit have further weakened the currency. Foreign portfolio outflows, as investors seek better returns in other markets, have also exacerbated the situation.
To mitigate these challenges, some financial experts suggest strategies such as locking in favorable exchange rates through forex cards or forward contracts and exploring scholarships or part-time work opportunities abroad. However, these measures may provide only partial relief for families grappling with increased expenses.
The RBI’s efforts to stabilize the rupee include aggressive dollar sales and liquidity support measures. While these interventions have temporarily strengthened the currency by about 1%, market analysts believe that continued depreciation is likely unless global conditions improve or India sees a surge in export inflows.
For students aspiring to study in the US, this economic reality underscores the importance of careful financial planning and exploring alternative funding options. As costs rise sharply due to currency fluctuations, many families may need to reassess their plans or seek additional resources to fulfill their academic dreams abroad.
