(MENAFN- Live Mint) The US President Donald Trump-led federal government, in an official memo to US colleges, has asked the institutions to sign a deal that imposes certain limitations on foreign enrollment and diversity in order for them to get access to federal funds.

What is the 15% cap on International students?

In a memo sent to U.S. colleges on October 3, 2025, the federal government proposed imposing a 15% cap on educational institutions that provide admission to international undergraduate students wishing to study in the United States.

This move from the government comes as they threaten universities to cut their federal funding over a range of issues, including pro-Palestinian protests against Israel's war in Gaza, transgender policies, climate initiatives and diversity, equity and inclusion programs, according to a news report from AP.

“No more than 15% of a university's undergraduate student population shall be participants in the Student Visa Exchange Program, and no more than 5% shall be from any one country,” according to the memo cited in the agency report.

The federal government also asked US colleges to stop using racial or sexual preferences when hiring or granting admission to international students.

What does this mean for Indian students?

Indian or Indian-origin students make up the largest international student community in the United States, followed by Chinese students.

If US colleges accept the Trump administration's deal, then the proposed 15% cap on international enrollments could potentially restrict access for many Indian students who plan to apply to the best universities in America.

According to a Texas-based immigration attorney, if the universities in the United States accept the terms of the federal government, then they will gain preferences in terms of US government funding and grants. However, the expert also highlighted how they can potentially lose out on a 'large number of international student applications.'

These grants, which are provided by the US government, are essential for funding research and extending scholarships to deserving candidates.

“Right now, it looks like this proposal has just been sent to nine universities. They're proposing that if you accept these terms, you'll get preference in terms of funds, research funds, research grants, and federal grants.” The larger idea, he said,“is not just about international students,” Chand Parvathaneni, the Texas-based immigration attorney, told the news portal The Indian Express.

Universities like Massachusetts Institute of Technology (MIT), University of Pennsylvania, University of Arizona (UA), Brown University, Dartmouth College, University of Southern California (USC), University of Texas (UT), University of Virginia(UVA) and Vanderbilt University have reportedly received this memo from the US government.

According to a PTI report, the total number of international student arrivals in the US dropped by nearly a fifth in August. The National Travel and Tourism Office data showed that foreign nationals arriving in the US on student visas declined by 19% in August 2025, compared to the same period a year ago.

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