Immigration, Refugees and Citizenship Canada (IRCC) rejected 74 per cent of Indian study permit applications in August this year, marking a sharp increase from the 32 per cent refusal rate reported in the same month in 2023.Of the 4,515 applications filed by Indian students in August 2025, only 1,196 were approved, a huge drop compared to the 20,900 submitted in August 2023, when Indian students made up more than one-fourth of all international applicants.While the overall rejection rate for all countries hovered around 40 per cent, Chinese applicants faced a 24 per cent refusal rate, underscoring intense scrutiny directed at Indian candidates. For Indian students, whose representation among study permit holders surged from just 2 per cent in 2000 to becoming the largest cohort by 2023, the long-standing dream of “study, work, stay” in Canada is now shattered.The surge in rejections is closely tied to Canada’s broader immigration policy overhaul, which targets fraud and controls international student numbers.The international student cap was lowered in 2025 to 437,000 permits, a 10 per cent reduction from 2024’s 485,000, and a 35 per cent cut from prior peak levels. Indian applicants experienced a projected 31 per cent reduction in visa allocations. The first half of 2025 alone saw nearly 90,000 fewer permits as compared to 2024, with Indian applications and approvals falling sharply.Visa fraudA key driver of the restrictive stance is a crackdown on fraud. In 2023, IRCC uncovered nearly 1,550 fraudulent Indian study permit applications linked to fake acceptance letters.Brijesh Mishra, a travel agent from Jalandhar, allegedly sold fake admission letters from Canadian colleges. Many students fell for it, arriving in Canada only to face deportation when authorities checked their papers during permanent residency bids. In May 2024, Mishra pleaded guilty in a British Columbia court to fraud charges, but he fled back to India. The Jalandhar police caught him at Delhi airport in June this year as he returned from Canada.Story continues below this adBy 2024, enhanced verification tools flagged more than 14,000 suspicious documents globally. Applicants now face rigorous “enhanced verification” procedures, requiring detailed proof of the origins of their funds rather than basic bank statements.Jaspreet Singh, Founder, International Sikh Students Association, said, “Fraud is a concern,” and recalled how promises of smooth pathways to permanent residency drew many into risky schemes. Visa consultancy CEO Michael Pietrocarlo noted that students “may have to go the extra mile”. “Here’s where the money came from.”These reforms have transformed the visa application process into almost an interrogation process.Canadian colleges’ budget hitThe effects resonate across Canadian campuses, particularly at the University of Waterloo, where Indian enrollments have dropped by two-thirds over the past three years. Institutions such as the University of Regina and the University of Saskatchewan report similar declines, raising concerns about talent loss.Story continues below this adInternational students contribute roughly $22 billion annually to Canada’s economy, but the shrinking Indian student segment is adversely impacting the budgets of Canadian colleges.Diplomatic strains since 2023, including allegations surrounding the killing of Sikh separatist Hardeep Singh Nijjar, which Canada’s former prime minister Justin Trudeau linked to Indian agents — a claim New Delhi has denied — have further complicated Canada-India relations and indirectly chilled student flows.Acknowledging the challenges, the Indian Embassy in Ottawa stated, “Some of the best quality students available in the world are from India, and Canadian institutions have in the past greatly benefited from the talent and academic excellence of these students.”Canadian Foreign Affairs Minister Anita Anand emphasised the desire for Indian students tempered by a commitment to immigration integrity.Story continues below this adWith the Canadian gateway narrowing, many Indian students are now heading to destinations like Australia and the United Kingdom, where Indian student visa approvals increased by 20 per cent and 15 per cent, respectively, in 2025.