Australia comes second in the organisation’s “global gauge” for international higher education, while the UK sits in third place.
The top three are followed by China, Malaysia and the US.
The ranking is based on an analysis by the British Council both of government policies that encourage international opportunities and those that act as a barrier.
Its findings will be debated at the Going Global conference in Hong Kong this week.
The factors taken into account by the ranking include each country’s “openness” to international study, the levels of support for those working or studying abroad, and quality assurance and degree recognition worldwide.
Although it is in third place overall, the UK comes top for openness – a measure that takes account of the fairness and transparency of visa rules, regulations governing the activity of universities and the scope of government strategies for international higher education.
The UK’s position in the ranking may not be so favourable if the coalition government’s plans to restrict student visas in the country are followed through. Details of the proposals are expected to be published as early as next week.
Germany scored particularly highly in the British Council ranking because of policies that encourage domestic students and academics to spend time abroad, as well as its success in attracting international students.
The British Council said German universities had attracted more foreign students by teaching a larger number of courses in English. It was also an attractive study destination because tuition fees were subsidised by the government.
The UK fell down in the “access and equity” category because of the limited support available for students and academics to take their work overseas, and because few financial incentives are provided for incoming international students.
Pat Killingley, director of higher education at the British Council, said: “The findings show that while the UK’s policies are helping it to maintain a strong position in the market, we still have some lessons to learn from other countries.”