Public “panic” over immigration is causing harm to the economy, the Business Secretary has warned.
Vince Cable said overseas students were being deterred from studying at British institutions and tight visa controls were causing difficulties for foreign experts working here.
Overseas students were being caught up in the “very torrid and emotional” argument about the number of immigrants, he said.
Official figures just released reveal that, in the year to September 2012, net migration fell, with a 22 per cent decrease in the number of foreign students.
Mr Cable said: “When the numbers decline, this is a great triumph for immigration control, which is quite absurd and, unfortunately, is seriously distorting the debate on sensible university policy and, indeed, sensible immigration policy.
“I just want to make absolutely clear, as far as the Government is concerned, we have no cap on the number of overseas students, we don’t propose to introduce one.”
There had been a “substantial” reduction in the number of Indian students, he added.