The federal and provincial governments have been underfunding universities for decades. Recently, universities were able to start recruiting foreign students to make up for the shortfall, but it looks like that money tap will be turned down. It doesn't look like there's a plan to make up for it.
At the same time, the feds want to
recruit more than 1,000 top international researchers to Canada, with the budget injecting up to $1.7-billion into a suite of recruitment measures.
That'll be tough if universities see their income crater.
It would have been trivially easy to kill diploma mills off without affecting public universities and colleges. There's only around 200 of those across the whole country and they're heavily regulated/monitored/audited, and they could have just given them an exception on the quotas to keep them fully functional.
I'd mostly agree, although there are a number of institutions that were previously providing more balanced services and "saw green" to focus more on international revenue and might need to scale back as well.
Best thing is just to remove the changes that allowed international students to work off campus (and increase policing of those hiring illegally). That particular change really seems to have been a tipping point for the system