New Zealand First Leader Winston Peters has criticised the number of foreign students choosing to study here, saying it is likely due to incentives such as permanent residency.

Mr Peters said there were 93,000 overseas students enrolled to study, an increase of 12 per cent in the last year.

He also noted that the number of Indian students studying in New Zealand had risen by 60 per cent over the last year. "The number coming in is spiralling thanks to 'incentives' being offered beyond the visa rules. The National government's softening of restrictions, by allowing foreign students to work is pushing numbers to unacceptable levels.

"At the same time, students are being 'sold' the student visa as a pathway to permanent residency."

Advertisement

Earlier today Radio New Zealand reported there were 15, 640 Indian students studying at tertiary institutions and polytechnics around the country in the first eight months of last year - a 60 per cent increase over the same period in 2013.

Independent Tertiary Institutions chairman Feroz Ali told RNZ the right incentives were in place for attracting students to New Zealand.

These incentives included opportunities for students to gain job-seeker visas and also to qualify for residency.

Mr Peters said many of these overseas students were "behind counters in supermarkets and working in service stations".

"Kiwi workers now face more unfair competition for jobs, which are not in abundance. The official unemployment rate is 140,000 and about a quarter of young Maori and Pasifika do not have a job.

"Student visas should not be used to flood the job market, drive down wages and undermine conditions and increase the already record number of permanent immigrants."