London Metropolitan University (LMU) which had to expel 2,600 including 350 Indian students because of visa irregularities in July could be taken over by a private buyer if the loss of its visa licence leads to insolvency. The institution is mounting a legal challenge to the UK Border Agency’s decision to revoke its highly trusted sponsor status.

Meanwhile LMU’s vice chancellor has warned that banning the university from enroling foreign students would have a “profound impact’’ on international confidence in the entire British higher education sector. A draft letter from the home ministry to Downing Street, obtained by The Sunday Times, states that London Met will become the first university in the UK to lose its licence to sponsor visas for students from outside the European Union. The letter cites London Met’s “failure to comply with their sponsor duties and the resulting threat to immigration control”.

The decision, which has yet to be confirmed by the home ministry, would mean the university’s 2,600 existing non-EU students would have 60 days either to find places at other universities or leave the country. London Met is already prevented from enroling new overseas students after its “highly trusted sponsor’’ status was suspended in July.

Malcolm Gillies, vice chancellor of London Met, warns that revoking the university’s licence could seriously damage the reputation of all UK universities, for whom income from overseas students is increasingly important. “The impact on the sector would be profound. It would be a mad thing to do. I am (about to speak) on Indian TV and you can imagine the kind of questions I’ll be answering. I’ll be doing my best to maintain the high reputation of the sector,’’ says Gillies.

In 2010-11, English universities increased their income from overseas students tuition fees by 16 percent to £2.5 billion (Rs.22,000 crore). Fees paid by overseas students made up 10.9 percent of the sector’s income, “the highest on record’’.

With the home office refusing to confirm or deny the letter’s contents, thousands of overseas students remain unsure whether they will be permitted to continue their studies this autumn. Comments Nicola Dandridge, chief executive of Universities, UK: “This (suspension) has been ongoing for almost seven weeks now, and recent media reports have done nothing to ease (students’) concerns. We would urge the home office to reach a decision as a matter of urgency.’’

The loss of its licence is likely to cause great financial pain to London Met. In 2010-11, some 15 percent of its £157.8 million (Rs.1,388 crore) income came from foreign students fees.

(Excerpted and adapted from Times Higher Education)