Hong Kong (CNN) — For more than a decade, Chinese students have flocked to the United States, drawn by the prestige of an overseas education and the glamor of the American Dream. Education consultancies flourished across China, with parents paying big bucks for tutors and classes that promised to send their children abroad.

But that’s changing now – and recent statistics suggest the allure may be wearing off.

During the last academic year, students from India became the largest group of international students in American higher education – knocking China off the top seat for the first time since 2009, according to figures released Monday by the State Department and the non-profit Institute of International Education.

China was still a major source, making up one fourth of all international students, compared to India’s 29%, the report found.

But experts say the decline reflects significant shifts in both policy and public perception, with many Chinese students and families worrying about safety, racism and discrimination, and immigration difficulties – especially as more options open up in other countries, including in China itself.

Meanwhile, India overtook China as the world’s most populous country last year, and more than 40% of Indians are aged under 25 – prompting hopes of a youthful new engine for the global economy just as China’s population begins to dwindle and age. There were more than 331,600 Indian students in the US last academic year, according to the State Department.

“We’re seeing from both sides, Chinese students studying in America and American students studying in China, the numbers are going down,” said Mallie Prytherch, a researcher at the University of Hong Kong’s Centre on Contemporary China and the World, who interviewed Beijing university students on their views toward the US during the pandemic.

For many Chinese students, “their parents, their teachers, had said, ‘Go to America, study, maybe you can even stay – you’ll get a good job, have a good life,’” she added. But the “onslaught” of racism and anti-Asian hate crimes during Donald Trump’s first presidency and the Covid-19 pandemic meant students became “disillusioned with this idea of the American Dream,” she said.

A changing China

It was a different world in the late 2000s and early 2010s, when Chinese students first began surging overseas.

At the time, China was rapidly transforming from a poverty-stricken nation to an economic superpower, thanks to an “opening up” initiative that began in the late 1970s and saw sweeping reforms.

It also changed China’s relationship with the world. After China joined the World Trade Organization in 2001 and hosted a tremendously successful Olympic Games in 2008, “there was this upturn in US-China relations – everyone had a really optimistic view of what China could be,” said Prytherch. “So there was a lot of openness in accepting students into America.”

Many Chinese families were also newly wealthy in this flourishing economy. There was a feeling of “opening and moving out, and a chance to really go somewhere different,” Prytherch said.

The State Department’s figures reflect this trend – with the number of Chinese university students in the US rising from about 98,200 in 2009 to a record high of 369,500 in 2019. That also meant China became an increasingly lucrative market for American universities, who stepped up efforts to attract students from the nation.

But attitudes began changing by 2016 as Trump was in his first run for office, Prytherch said. US-China relations tanked in the following years, as the two countries engaged in a trade war and finger-pointing during the pandemic.

The downward spiral was reflected in policy, too: Trump imposed an executive order canceling the US’ Fulbright exchange program with China, then introduced a ban that effectively prevents graduate science, technology, engineering and mathematics (STEM) students from several Chinese universities from gaining visas to the US, the world’s biggest research hub.

In 2020, the US revoked visas for more than 1,000 Chinese students and researchers deemed security risks. When President Joe Biden took office, many of those Trump-era policies were kept in place – making it difficult for Chinese grad students and researchers to secure a visa.

In January this year, Chinese foreign ministry spokesperson Wang Wenbin said in a briefing that “dozens of Chinese nationals, including international students, have been forcibly deported by the US each month.” He decried it as “discriminatory,” urging the US to protect the rights of Chinese students abroad.

Li Jing, a research assistant at Tsinghua University in Beijing with a master’s degree in cybersecurity, told CNN in June he tried to attend an academic conference in the US but was denied a visa three times, costing him nearly $690 in the process.

“I don’t know whether it’s my academic background that renders the visa denials,” he said.

The Covid years

The number of Chinese students in the US plunged during the pandemic and hasn’t rebounded since.

“The total number of students from China has decreased in the last three years, primarily at the undergraduate level,” said Mirka Martel, research head at the Institute of International Education, at a briefing Monday announcing the latest figures.

One education consultancy, Education First, has seen a 10% decline in the number of Hong Kong and Macau students wanting to attend college in the US, according to general manager Steven Hon.

The State Department’s figures didn’t come as a surprise to many on Chinese social media platforms. “Since the economic sanctions and tech restrictions started in 2018, many (Chinese) students have been sent back home,” one user wrote on Weibo. Another user wrote: “The only reason I don’t want my child to study in the US is safety — issues like violence, robbery, gun violence, and drugs.”

Concerns about safety have only risen since the pandemic brought a wave of anti-Asian racism and hate crimes. And while gun violence has always posed a worry for overseas families, the increased use of social media during the pandemic also meant attacks circulated more widely online, reaching more eyes in China, said Prytherch.

The US government’s handling of the pandemic also shook students in China, she added. Although many were also unhappy with Beijing’s strict zero-Covid policy and the chaotic end of its lockdown years, they still largely preferred that to the sense of Covid running rampant in the US – viewed not only as a failure of the government, but of democracy.

During her research in Beijing, one student told Prytherch: “In America, they say you’re free, but if you can’t walk safely on the street, how is that freedom?”

However, Hon said, the decline didn’t mean there was necessarily less appetite for an overseas education – just that there were more choices besides the US now.

“The reason why we’ve seen a slight drop in the US is because there have been more immigration-friendly policies in other nations, like Canada, the UK and Australia,” he said. “Parents have a lot more options to choose from in terms of where they want to go, and what universities are willing to accept their children.”

One of those options is simply staying in China, where universities are growing in prestige, said Prytherch. Many Chinese professors previously based in the US are now returning to teach in China – partly because of the difficult conditions they faced in the US, but also because of the improvement in Chinese educational quality, she said.

In that context, many students no longer think an American education automatically grants them a competitive edge in the Chinese market unless they attended an Ivy League or a similar top university, she added. In fact, with more Chinese students eyeing the stability and benefits of government jobs, some even wonder if an overseas education might damage their chances of such a career.

All that said, the US is still a highly popular destination for students, said Hon, from Education First – especially graduate students in AI and tech, since the top schools and research grants in those fields are still largely American.

And despite the tightening of immigration rules under the last two administrations, some US officials are still trying to encourage the flow of students.

“I want to confirm that we very much welcome students from China to the US. We have the largest number of Chinese students studying outside of China here. We do know that US universities are continuing to value Chinese students,” said Marianne Craven of the State Department in a briefing this week, according to state-run outlet China Daily.

Whether Chinese students believe that is another question.

“A lot of (Chinese students) want families in the future, and they’ve begun to think that China is the best place to do that,” said Prytherch. “They think, you know what, China is not too bad anymore. At least it’s safe.”

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