More and more universities are setting up shop in the subcontinent to take advantage of its economic strength

One hundred students from India paying fees of £10,000 each makes £1m. You can almost hear the ping of the cash register as Professor Ashraf Jawaid, the deputy vice-chancellor of the University of Bedfordshire, describes the new joint MBA it is launching with a university in India.

Partnership, academic exchanges, joint ventures, research collaboration, just about everything short of building a campus on Indian soil (illegal) are the ways in which universities in the UK are seeking a stake in the subcontinent. King's College London has set up a centre for Indian studies with Jawaharlal Nehru University in New Delhi, which will undertake joint research and see students on exchanges from the UK to India and back. Greenwich has established a Centre for Indian Business, Wolverhampton is helping to improve the English language skills of school teachers in the Punjab and Lancaster will go a step further, delivering its business, economics and computing degree courses at the GD Goenka World Institute of Higher Education near Delhi from August.

These are exciting times, not least because it doesn't seem to matter to India whether you are a world ranking Russell Group institution, a redbrick or a former polytechnic, as long as you carry the brand and the quality assurance of a British higher education institution.

Both Tony Blair and Gordon Brown have backed closer links as India grows into one of the most important emerging economies. But how much is this new spirit of cooperation inspired by enlightened internationalism and how much by a desire to bolster university coffers? Despite Britain's historic ties with India, it is the US that has established itself as the chosen destination of the country's overseas students. Of the 123,000 Indians at universities outside their homeland, 76,000 are in the United States compared with 19,000 in the UK.

Professor Jawaid certainly does not deny the financial advantage of recruiting more overseas students but says the aims of the joint programme are much wider. Bedfordshire will get committed, enthusiastic, good quality students selected by the Institute of Chartered Financial Analysts of India (ICFAI) University in Tripura. The students will study over 18 months in both countries, ending up with an MBA from ICFAI and a Master of Business Management Suite from Bedfordshire.

"For the students it will be a huge bonus. When they go home they will quickly move up the career ladder," he says. "The world is a smaller place and from here they will get an international degree and grooming in skills such as talking to industry, making presentations and dealing with senior managers."

Higher education has become truly global and there is competition for the best staff and students, says Mike Thornton, the operations manager of the UK-India Education and Research Initiative (UKIERI). "There is a lot of good research going on in India which complements the work we are doing here in the UK, and it makes good sense to bring the two sides together," he says.

Tim Gore, the director of the Centre for Indian Business at the University of Greenwich, says UKIERI does not support any collaboration purely aimed at recruiting students. "If anything, it is helping to create capacity in India to offer good quality, good value qualifications within reach of a wider section of society," says Gore, speaking from India where he was helping to launch Greenwich's ambitious 10 programmes with four universities. "The Indian economy offers enormous opportunities, but some will be lost if the skills are not there."

India may be an emerging economy, but the benefits are by no means all one way, says Professor Anthony Brookes, a geneticist at the University of Leicester whose work with Professor Samir Brahmachari, the director of the Institute of Genomics and Integrative Biology in Delhi, may one day explain why some people are more susceptible than others to certain diseases.

"Before the UKIERI funding we worked for six months on one particular aspect of the project and progress was slow," says Brookes. "Our approach to research is innovative but you could almost describe it as reckless. The Indian approach is much more disciplined; everything is logged and documented and it was this careful attention to detail which helped us solve the problem. Working with scientists from the Institute allowed us to achieve more in two months than we did alone in six."