New Delhi, April 24 Recession is bound to hit Indians wanting to study in the US, but America is offering more scholarships, a senior American diplomat said on Friday.

Indians represent the largest community of overseas students in American colleges and universities.

"The recession may affect the ability of many (Indian) families to afford American education costs this year as well as the ability of the institutions to offer generous scholarships," Steven J. White, Deputy Chief of Mission at the US embassy, told the American Chamber of Commerce in an address.

But he said there would be a "substantial increase" in the number of Fulbright-Nehru scholarships for graduate and post-graduate training.

White said the global economic crisis had hit American universities very hard.

"Public institutions are straining under reduced budgets from revenue strapped state governments and private institutions have seen a plunge in the value of their endowments.

"For the time being, American higher education leaders are scaling back their global expansion plans to focus on their core businesses."

White added that he planned to urge the new Indian government to promote more cooperation between universities in the two countries "because current restrictions have done much to discourage the kind of linkages that will increase mutually beneficial research".