Indian students are more likely to breach visa conditions than other foreign students, according to a government study.
Saying they are three times more likely to do so, the government actually brands them a 'high risk' group.
The damning visa categorization could dent to some extent the campaign for better protection to Indian students, increasingly subject to racist attack in the state of Victoria.
A review of the student visa program assessment levels, conducted by the Department of Immigration and Citizenship last September across all applicant countries, ranked Indian students alongside Bangladeshis and Cambodians as a level-four risk - the second highest risk category. No country currently ranks as a top level-five risk.
Immigration risk levels for Indian students were upgraded after a DIAC audit found that in 2006-07, 4.66 per cent of the 58,268 Indian nationals granted visas breached their conditions, compared with an average rate among foreign students of 1.32per cent.
In 2007-08 the unlawful rate among Indian students was 1.48per cent of a total 87,145 Indian visa-holders, compared with 0.99 per cent for the average foreign student.
Indian students must now prove they have enough money to survive for the duration of their study and pass more stringent English language tests.
Harmeet Pental, South Asia director of the IDP Education agency (a global company offering student placement and English language testing services), said he had seen no evidence of a drop in enrolments for the July university semester among Indian students, though that could change next year.
As many as 14 Indian students have been assaulted in Australia in the past month, sparking angry protests in India, Australian newspaper reported.
But Mr Pental said of greater concern was the impact new visa restrictions would have on the growth in the numbers of Indian students attending university.
He felt the crackdown failed to distinguish between "quality" university students and the almost 80 per cent of all Indian students who came to study vocational education training courses such as cookery and hairdressing, seen by many as a backdoor means of gaining permanent residency.
Gulshan Pathania, president of the Association of Australian Education Representatives in India, also complained that while visa breaches were overwhelmingly committed by vocational students, university students were also being punished.
The number of Indian students studying in Australia has risen dramatically in recent years, from 11,313 in 2002 to 96,739 last year.
The Immigration Department insists the visa restrictions will not affect the applications of genuine students.
Meantime Immigration Minister Chris Evans has said international students need to be given more support while they are studying in Australia.
Senator Evans has been in Melbourne for talks with Indian students and community representatives about the recent violent attacks on students.
He says Australia needs to do better.
"We haven't perhaps provided enough social support to support the growth in Indian student, or foreign student, numbers in Australia," he said.
"We've had a huge growth in recent years of foreign students to this country and that's been great for the education industry, creates a lot of jobs for Australians, a lot of business.
"But what we haven't perhaps seen is the same growth in support services for them in the community."
He, however, said the Indian media reporting tended to be unbalanced.
"The couple of incidents have been represented as a much more systemic, more general, violence against India and race-based. I don't think that's true."
He says, "That's not the advice I get. So it is important that we send a different message to India."