There has been a dramatic drop in the number of university students going abroad to study, a House of Lords committee has warned.

The number of undergraduates from the UK spending part of their degree studying in another European country has fallen from 12,000 in 1994 to 7,538 in 2003.

This "deeply disturbing" drop threatens to leave Britain unable to "protect our interests" abroad and to compete economically in Europe, peers on the European Union Committee warned yesterday.

"We are deeply disturbed ... about the declining capacity for language-learning in this country", the report concluded.

"The programmes cannot do much to help redress the balance unless urgent and effective action is taken nationally to invest more at all levels."