The leader of a new political party aimed at immigrants has joined calls for the foreign education system to be reviewed as 150 Indian students face deportation.
The students say they didn't know their India-based agents used fake financial documents to get them visas to study in New Zealand and argued they won't be eligible for refunds of tens of thousands of dollars in fees they've already paid.
NZ First Leader Winston Peters has called for an independent investigation into education export fraud, calling the industry a "giant-sized racket" with many international students viewing the system as a pathway to permanent residency.
He said the students should be allowed to stay if they weren't at fault.
On Sunday, Roshan Nauhria, the leader of the newly founded New Zealand People's Party, told Q+A students in India were being told one story, only to find something else when they arrived.
He said he had expressed concerns to various governments over the years - both about the quality of some schools and the systems used to recruit students in Indian - but believed they were more concerned about revenue from the industry.
The Government needed to ensure potential students in India were being properly informed, he said.
Immigration Minister Michael Woodhouse told Q+A he was aware some students had expectations about gaining residency through studying in New Zealand, but most wouldn't.
"About 19 percent of the students who graduate from our universities, Polytechs and PTEs have gone on to gain residence," he said.
He said there were concerns about agencies in India offering students false hope about residency.
"This is a challenge that not only New Zealand faces but many other countries that also have international education from India," he said.
Economic Development Minister Steven Joyce earlier denied there was a problem with the system and said the issues New Zealand faced with agencies in India were similar to those experience by other countries.
"We obviously want the agents to behave themselves well and we know some agents having been behaving themselves. So we've tightened up the rules recently. We've put in a new requirements in the code of practices that providers must be accountable to their agents' behaviour," he told TV3's The Nation on Saturday.
The students who face deportation say they paid tens of thousands of dollars to education providers in New Zealand who worked with the recruiters in India.
They have been told they couldn't have refunds if they were sent home.