CASH-STRAPPED universities are struggling to attract the foreign students they need to boost their income, new figures showed today.

The number of applications received from overseas students - who typically pay fees eight times higher than those UK undergraduates are charged - fell by 5.3%.

Overall applications received by January 15 were up 8.9% from the same point last year, with a rise in numbers applying from new EU countries, said the Universities and College Admissions Service.

Vice-chancellors are worried that British universities will be plunged into deeper financial problems without more income from the higher fees non-EU students pay.

The National Union of Students said the drop in overseas applications could be down to the increase in tuition fees from £1,150 this year to £3,000 per student from 2006.

They also blamed new Government rules that will make it much more expensive for foreign students to extend their visas if they need to stay in the UK to continue studying.