"We can't stop the good and meritorious students from coming to the UK. Let's deal with the problem differently. A unique and pleasant characteristic of those good students coming here (the UK) is that it helps the British students as well," he told PTI.
"One of the major learning processes when you are able to work with each other from different nationalities, that itself is an education. I went to MIT in 1949 and I think I learnt as much by mixing with the students of different countries than just education," he said at a function here last evening.
The 82-year-old chief of the Caparo group and a Labour Party Peer appealed the UK government for making the visa system "pro-talent and pro-merit".
"I request the UK government for a better visa system for foreign students and also I'll speak about it in Parliament. The students coming here do a lot of good work for Britain and also remember us on returning and share the good things that exist here. See, we are almost getting free ambassadors," Paul said.
He admitted the persistence of some problems that the government faces like "overstaying" and "fake students", and said they should be dealt with in a stringent manner.
Lord Paul, a Chancellor of the Wolverhampton University, was speaking on the occasion of a scholarship initiative taken by the University for underprivileged girls here.
The University also awarded scholarships to fund education till higher secondary level to five primary school girls from a local school near Badarpur - Sapna, Nandini, Saraswati, Anjali and Shama - all belonging to BPL families.
Vice Chancellor Geoff Layer announced scholarships to 10 students next year, whose number would increase every year.