Indian students are studying in UK higher education institutions in record numbers, up 24 per cent last year, latest figures show.

According to data from the Higher Education Statistics Agency, the figure rose from 19,205 in 2005-06 to 23,835 the following year.

India remains second in a list of nations with the most students at UK institutions, despite numbers from China, which tops the list, falling 2 per cent from 50,755 to 49,595.

Among other non-European Union countries with significant increases are Nigeria, up 16 per cent from 9,605 students to 11,135, and Pakistan, up 17 per cent to 9,305. The number of US students in the UK rose 8 per cent to 15,955, putting the country third in the table.

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The total number of students from non-EU countries rose by 7 per cent to 239,210. Among EU countries, the most significant increase is in students from Poland, which rose 56 per cent, taking the number to 6,770.

Rick Trainor, president of Universities UK, said the figures underlined the UK's position as one of the main players in the global higher education market, and that the rise in students from India was "particularly welcome".

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"Despite some fierce competition, the UK continues to punch above its weight, with only the US attracting more international students in absolute terms," he said.

Meanwhile, a row has arisen over cuts to a government-funded scholarship scheme that helps international students study in the UK.

UUK said the decision to cut about ?10 million in two areas may in turn damage UK students' opportunities to study abroad.

The Chevening Programme, which provides 2,300 postgraduate scholarships a year, is to see funding fall from ?.3 million to ?18.8 million from next year, while the Commonwealth Scholarship and Fellowship Plan will be affected from 2009-10.

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David Miliband, the Foreign Secretary, said: "The schemes have had real strengths. But we need to refocus them to ensure that these strengths are consistent."

Scholarships would be focused on countries such as China and India, he said, "which are going to be most important to our foreign policy success over coming years".

Diana Warwick, chief executive of UUK, said: "Many scholarship students go on to be leaders in their fields, retaining valuable links with the UK and acting as ambassadors for our universities," she said.

Rob Wilson, the Shadow Minister for Higher Education, said: "Universities are fed up with the Government cutting funding without any consultation.

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"At a time of global uncertainty, there is a danger that the UK will be seen as unfriendly or, at worst, hostile to international students."

john.gill@tsleducation.com.