Jo Beall, director of education and society at the British Council, told Times Higher Education that the crackdown could result in a few more jobs for young Britons "flipping hamburgers and pulling pints", but at a great cost. She made the remarks as the British Council sent research to the government on the US and Australian experience with student-visa restrictions - later relaxed in both countries after drops in international student numbers.
The report picks out the impending closure of the post-study work option for non-European Union students and tougher English-language requirements at the sub-degree level - with the latter "expected to have a negative impact on pathways leading to higher education".
It concludes that "recent immigration changes have managed to single out the UK as the country with the toughest immigration regime when compared [with] its competitors", with the post-study work options in Australia, Canada and the US able to draw "genuine and career-driven students" away from the UK.
Dr Beall said the research showed that pathways to university and post-study work needed "urgent review...if we're not going to undermine the economic benefit that higher education as an export sector brings".
The British Council study cites Department for Business, Innovation and Skills research estimating that UK education exports were worth £14.1 billion in 2008-09. Universities Australia estimated that student visa tightening cost Australia A$428 million (£292 million) in 2010, it notes.
Media reports present a government split between a Home Office intent on implementing the Conservative election commitment to reduce net migration to the tens of thousands and BIS ministers concerned about the impact of the visa policy on business and universities.
The Home Office and UK Border Agency shared a "short-term" goal to reduce immigration, perceiving that international students are "taking British jobs", Dr Beall argued.
"The worst-case scenario is that these short-term gains - of a few more young people flipping hamburgers and pulling pints who are British - [come] at the cost of the strength of our industrial innovation, our research and development base, our reputation as a higher education provider, which is second in the world at the moment," she said.
While welcoming the proposal by Damian Green, the immigration minister, to offer a limited visa option for overseas "graduate entrepreneurs", she argued that a full post-study work option was vital. "It's a pity in a way to dismantle something then replace it with a plethora of more complex legislation," she said.
Although the British Council was "respectful and supportive of the government's concern to reduce the abuse of the system", it had a "responsibility...when we have the evidence to make that evidence available to government", she added.
On some postgraduate biotechnology and engineering courses in the UK, Dr Beall said, the proportion of non-EU students was as high as 90 per cent. "That means our students are being exposed to competition, to knowledge, to engagement and dialogue with international students; it means international students are paying to keep some of those departments alive," she said. "If those departments die because they are not resourced...British students will have to go and study (science, technology, engineering and mathematics) subjects abroad."
Dr Beall highlighted the international nature of research: "We know that 70,000 patent applications in the US have been put in by teams that include international as well as American researchers.
"That is more than the UK and the Bric [Brazil, Russia, India and China] countries put together."
She also pointed to Universities UK figures stating that more than 40 per cent of international students in UK higher education come via sub-degree courses here - the level targeted by the coalition.
"Students come on a pathway," Dr Beall said. "Universities are depending on that. The government has genuinely not understood how interconnected and interlinked the tertiary education sector is."
Licence revoked: universities in the firing line
Several universities are close to losing their licence to sponsor foreign students, a leading immigration lawyer has said, with one believed to have been suspended over Christmas.
Nichola Carter, head of immigration at Penningtons Solicitors, said a handful of publicly funded universities could soon have their Tier 4 "highly trusted" status revoked by the UK Border Agency. From April, only highly trusted institutions will be able to recruit international students as part of the government's crackdown on student-visa abuse.
"We are very close to seeing the first university having its licence revoked," Ms Carter told a Westminster Education Forum seminar in London last week, titled UK Universities in a Global Higher Education Market.
"It is very easy for a sponsor to trip up and break one of the requirements."
It is understood that one university had its licence temporarily suspended over Christmas, although the UKBA declined to comment.
The clampdown on student visas is a key element of the government's strategy to reduce net migration from about 250,000 people a year to "tens of thousands" by the end of this Parliament.
But private higher education colleges have complained that the strict guidelines are "devastating" the industry, with enrolments down by as much as 70 per cent. Referring to the bogus colleges that sparked the clampdown, Ms Carter said that the era of "colleges over kebab shops" was already over.
Other delegates also warned about the impact of the restrictions on reputable institutions, citing the case of Cavendish College London, a private institution that blamed the policy change for its recent closure.
Beatrice Merrick, director of services and research for the UK Council for International Student Affairs, said: "We are not seeing the dregs or places above chip shops closing. Cavendish was as highly rated as you can be."
The government's hard-line stance could have further unintended consequences, she added, drawing attention to India's decision to award a £7 billion jet-fighter contract to France rather than the UK.
"One of the arguments raised...is that the Indian government was not that thrilled about our student-visa policy. We have seen damage coming from these things," she said.
John Hearn, deputy vice-chancellor (international) at the University of Sydney, warned that a similar crackdown in Australia led to a slump in overseas applications.
The Australian government has since taken steps to reverse the policy.
"It is the first time Britain has followed Australia's mistakes," Professor Hearn said.