An increase in visa fraud has accompanied the rise in demand from foreign students to enrol in Australian education.
Figures released by the federal government last week revealed that Australian universities enrolled a record 108,000 foreign students in 2000 - a rise of 19 per cent on the previous year.
In the same period, visa fraud has also risen. In India, Australian officials rejected more than half the 8,100 visa applications lodged by prospective students over the past 12 months.
They referred to the police a number of agents who arrange visa applications and an even larger number of students, after uncovering a network specialising in producing fake bank and education documents.
A similar situation has been identified in China, where bank managers are believed to have accepted bribes in exchange for inaccurate information about the financial status of students.
Kim Carr, the Labor opposition's parliamentary secretary for education, said the level of fraud detected by officers at the Immigration Department's headquarters in New Delhi reached 20 per cent in the past year.
He said there was evidence of unacceptable levels of fraud involved in overseas applications in some countries.
The number of visas cancelled in Australia as a proportion of the total approved offshore has also increased rapidly - from 7 per cent three years ago to more than 17 per cent in 2000.
"These are matters of great concern," Senator Carr said. "They undeniably have the potential to undermine a vigorous and important industry. Such figures can damage not only education providers here in Australia but a major export industry as well."
Changes to Australia's visa regulations have made it easier for Australian education institutions to recruit overseas students.
Senator Carr said Labor believed the legislation should have been predicated on a balance between encouraging recruitment while maintaining the integrity and probity of visa applications.
Releasing the latest figures on foreign enrolments, federal education minister David Kemp said Australia's world-class education system, democratic traditions and safe environment provided an attractive study destination for overseas students.
Dr Kemp said international students in Australia generated A$3.7 billion (£1.3 billion) in income last year "and that means a better education for all of our students".