Australia has established a scholarship scheme as an Antipodean rival to the Rhodes and Fulbright programmes. It will offer awards to 16 Australian and overseas postgraduates each year.
The General Sir John Monash Awards, named after one of Australia's best known engineers and soldiers, will be worth A$50,000 (£19,000) over three years.
Eight will be made to Australian postgraduates to enable them to study overseas and eight will be reserved for foreign postgraduates to study in Australia.
Prime minister John Howard said it would be Australia's most prestigious award for postgraduate study.
He announced that the federal government would provide A$5 million to fund the scholarships for the first three years. The government would also consider matching contributions up to a certain level from private sources and donations would be tax deductible.
The scheme will be operated by a foundation set up by a group of prominent Australians. They aim to raise nearly A$50 million over the next five years from government and private sources.
Mr Howard said the initial government grant would allow time for the foundation to reach a position where it could become self-supporting.