Changes to immigration rules could act as a deterrent to foreign students wanting to study in Australia, the IDP conference was told.
Monash University researcher Dr Bob Birrell said the rapid growth in numbers of overseas students in recent years appeared linked to an easing in selection rules.
After 1998, students who obtained their qualifications in Australia were given priority if they wanted to stay. A doubling in the overall skilled intake also resulted in a big increase in the numbers of former overseas students able to gain permanent residence.
'These innovations meant that graduates in selected fields who met the required educational standards were, in effect, guaranteed permanent residence at the end of their course,' he said.
In the six years to 2003, overseas student enrolments grew by 15 per cent a year - with about half of that from China and India.
More than a third of the students who obtained permanent residence between mid-2001 and January 2004 were from India, another 20 per cent from China and 15 per cent from Indonesia.
'The inference is that students coming from relatively low wage countries have a greater incentive to make the investment in an Australian education,' he said.
But this year, the Australian Immigration Department made it harder for foreign students to become migrants. Also, Australia no longer accepts graduates of 18-month master's courses.