EDUCATION helped to prop up the NSW economy by generating $6.4 billion for the state despite revelations of shonky colleges and violent attacks on Indian students.
The sector generated a record $16.6 billion for Australia in the past financial year.
Only coal, iron and gold performed better nationally than education, which grew by 22.6 per cent according to figures for international trade from the Australian Bureau of Statistics.
Higher education earnings from international students increased by $1.3 billion to $9.5 billion for the year. Vocational training earned $4.3 billion.
In NSW, education was the second biggest export earner, behind coal.
The figures show that the turmoil of violent attacks on Indian students, and a volatile Australian dollar, had yet to dampen demand for higher education, vocational training, schools and English-language courses.
The president of the International Education Association of Australia, Stephen Connolly, said the growth of international education as an export earner was unsurprising, but demand from India was likely to fall next year.
He said Federal Government targeting of shonky vocational education operators and further tightening of student visa practices would affect the number of students from the subcontinent, but demand from other countries would remain high.
"For families in many countries, overseas study is a long-term investment. For these families, funding their children's education is not a discretionary item to be cut at a time of economic uncertainty.
"It's not important whether gold or international education comes out third in export earnings. Fluctuations from year to year in the ranking of Australia's top export earners are only to be expected.
''But international education and the brain industries generally are on the right side of history. International education has proven to be largely resilient in a recession, while minerals tend to be subject to boom and bust. And of course one day the mines will run out.''
The Federal Government has tried to limit damage to the sector since stories began to emerge in May of bashings, car torchings and even a stabbing by screwdriver carried out by allegedly ''racist Australians'' against Indian students.
Attention also focused on private colleges that provided dubious diplomas and visa abuses in the sector.
The Government initiated the Baird review of the Education Services for Overseas Students Act and an international student strategy taskforce by the Council of Australian Governments to protect the industry and placate disquiet from India.
The chief executive of Universities Australia, Glenn Withers, said international students needed accurate information, orientation, English-language enhancement, integration into campuses and regions and support to find accommodation, employment and live in safety.
"Securing the ongoing sustainability of Australia's international education industry and our reputation for quality are vital,'' he said. "Only providers with a demonstrated commitment to quality education and enhancement of the whole student experience should be able to register or re-register to provide courses to international students.''
Last week the Senate education committee's report on international student welfare also found the need for travel concessions from all state and territory governments and the right for students to work more hours to support themselves.
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