🍁 Canada's Cost of Living Crisis Explained
How will this affect Indian students? Read on.
As the world welcomes 2024 with hope, Canada is still facing an old crisis.
And to solve this crisis, it has introduced a new policy.
And this new policy is set to send ripples across oceans and affect us sitting miles away.
Eh? What crisis and what policy?
Read on.
A New Year, An Old Crisis
Canada is facing a cost of living crisis (thanks, inflation).
Prices of everyday essentials are increasing dramatically.
Food prices are projected to increase between 2.5% and 4.5% next year.
Meat, bakery and vegetables are expected to see the biggest cost increase between 5-7%!
Naturally, living in Canada has become expensive.
You step out of your house, walk into a Canadian supermarket, and your wallet feels the pinch with every step.
Now, to ensure that people can afford Canadian life, the Ministry of Immigration, Refugees and Citizenship Canada (IRCC) has announced some reforms.
It has set a new cost-of-living requirement for study permits for international applicants.
For 2024, students will have to show that they have Canadian Dollars 20,635 (~INR 12.6 lakh)!
This was only Canadian Dollars 10,000 (~INR 6.2 lakh) earlier!
Yes, an increase of over 2 times!
Now, now.
This change in policy is done to ensure that international students can live comfortably in Canada.
But hey, Indians don't like price hikes.
This hike is not just a number.
It may curb the dreams and aspirations of thousands of Indian students.
Especially those from Punjab, who aspire to call Canada their second home.
This news comes at a time when the world is grappling with inflation.
Higher costs of IELTS exams, higher college tuition fees, higher rent, higher costs of flights.
In short, a higher cost of living.
So, what does this mean for aspiring scholars? And for the two countries?
The Ripple Effect: More Than Numbers
First things first, higher prices would mean lower demand.
With higher living costs, the number of Canadian study permit applications processed for Indian students has already reduced by more than 40% since July 2023.
With this new policy, this number may further decrease.
And this could be bad for Canada’s economy.
Why, you ask?
Well, Indian students are Canada’s largest international study group, accounting for ~40% of all international students!
This translates to Canadian Dollar ~10 Billion annually!
Not just Canada, but this could also send ripples across India’s economy.
You see, overseas education is a booming sector in India.
Educational consultancies, travel agencies, foreign exchange services - a lot of players work in symphony to send aspiring students to their dream destinations.
Now, this new policy could cause a slowdown in these sectors.
Now, fewer students going to Canada could mean fewer people working in Canada.
So?
Loss of remittances from Canada to India!
Looking for Alternatives
Now, whenever there is a price hike, people tend to switch to cheaper alternatives.
In this case too, students may switch to more affordable study destinations like the US, Germany and the UK.
These countries look expensive than Canada, but now that Canada's financial requirements have more than doubled, other countries will become cheaper comparatively.
Now, this could also be a blessing in disguise for India.
This could be a nudge towards building a robust and self-sufficient higher education system here.
This could be the first step towards reversing ‘brain drain’ from India.
Let us explain.
Brain drain is a phenomenon where Indians move out of the country and lead their dream life in other countries like the US, UK, France, Canada.
Over 3.2 crore Indians are currently settled abroad.
In fact, 19 lakh Indians reside in Canada alone, contributing to ~5.2% of Canada’s population!
And in doing so, they pay taxes in other countries.
They contribute to the growth of other economies.
High-quality education can solve this at the root.
Reverse brain drain could bring back valuable skills and experience, boosting innovation and entrepreneurship.
Can India transform this challenge into an opportunity?
Can we become an educational hub, not just for our own citizens but for students across the globe?
Let’s discuss in the comments!
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