There is a tradition at the University of Nottingham known as the "Campus 14", in which hard-drinking freshers attempt to down a pint in all 14 bars on site. In stark contrast, at the University of Nottingham in Malaysia (UNIM), the sale of alcohol - and cigarettes and condoms - is forbidden.

There are, of course, many other differences between the two: nestled as it is in the middle of a vast palm plantation, no one could confuse UNIM's campus near Kuala Lumpur with its parent in the Midlands. Yet geographical and cultural disparities aside, the degree that students earn is identical, whether they are based in the Tropics or the UK.

UNIM may be the most ambitious example of a British university's involvement in Malaysia, but the country has a diverse range of partnerships with UK institutions - links that are at the core of its aspirations to become an international "hub" for ÖйúAƬ.

Its strategy is founded on so-called "transnational education" - the delivery of Western degrees through partnerships with Malaysian institutions.

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The aim is not only to attract domestic students, but also to draw in foreign students from elsewhere in the region and the wider Muslim world - young men and women who want a UK, US or Australian degree, but who do not want to study in those countries.

It is Britain's good fortune that Malaysia - which has largely positive memories of its colonial past - tends to see the UK as its partner of choice. Boyd McCleary, the British High Commissioner in Malaysia, says that the importance of education as a link between the two countries struck him as soon as he took up the post.

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Speaking to Times ÖйúAƬ on the veranda of his official residence in the Malaysian capital, he says: "I have never seen anything quite like this; I think it's a fairly unique situation. Education is at the heart of our relationship. It is one of the key things we do here."

The strength of the link stems in large part from its longevity. McCleary explains that the tradition of local students travelling to the UK to study dates back to the run-up to Malaysian independence in 1957.

"Before the handover, the colonial Government recognised the need to provide structures to train its successors," he says.

"In 1957, Malaya, as it was then, had just one university of its own, so it was then that the first Malaysian students started going to the UK. Those people went on to become senior figures in the Government post-independence, and they haven't forgotten their time spent as students in Britain.

"As the country grew and needed to train more of its young people with very limited facilities, more and more went over there. Over the next few decades, thousands were sent, and that has been a very important component in making binding links."

McCleary says that this model, in which Malaysian students travelled to Britain at considerable expense to get a UK degree, was forced to evolve in the 1990s when the concept of transnational education took off.

"During the Asian financial crisis of the late 1990s, it became too expensive to send a young person to the UK, so we needed other ways of doing things. The system we have now has only been in place since then."

So successful has this new mode of delivery been that there are now more than 800 transnational education programmes in Malaysia, just under half involving British institutions.

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Peter Clack, director of education for the British Council in Malaysia, says: "There are at least three times as many Malaysian students studying for UK qualifications in Malaysia as there are in the UK. There are various business models: sometimes they will do the middle year in the UK, sometimes the final year, they might be on a franchise course - everything that can be done is being done, and the Malaysian authorities are flexible enough just to let the thing grow.

"Obviously they are concerned about quality, but they are letting the market develop because they have an ambition to get 100,000 international students studying in Malaysia, and they know that the UK brand helps those aspirations."

The British Council estimates that there are 44,000 foreign students in Malaysia, drawn from countries such as Bangladesh, China, Indonesia, Iran, Nigeria and Pakistan.

Clack says: "Half the students probably speak Farsi: we've got more Iranian students studying here with the British Council than we do Malaysians. It's very diverse, but the draw tends to be from the Muslim countries, the Gulf and Far East, and from Africa."

Perhaps the most significant factor driving demand for transnational education in Malaysia is cost - it is far cheaper to study for a UK degree in Kuala Lumpur than in London.

Clack points out that this applies not only to fees, but to living costs, too. "It depends how luxuriously a student wants to live, but you can live here on ?2 a day," he says.

Malaysia's desire to become an international destination for students is evidence of the maturing market for transnational ÖйúAƬ. Countries that have traditionally had a net outflow of students, such as Malaysia, are becoming "host" countries with a net inflow.

Of course, it is not the only country to set its sights on "hub" status. Connected to Malaysia by a causeway, Singapore is also looking to expand its offerings from Western universities.

Although Singapore has been successful, it offers a cautionary tale for overseas universities thinking about setting up shop abroad. Of the forms of provision open to a foreign provider, the most risky, from a financial perspective, is opening a campus. When the University of New South Wales attempted to do so in Singapore, it got its fingers badly burnt.

Its branch closed its doors in 2007 after just one semester, its failure blamed on its demands for high fees in a tight, government-subsidised education market, which resulted in disastrously low enrolment.

Guy Perring, the British Council's regional project manager for transnational education in Malaysia, says that Australian providers were initially hesitant about returning to the region in the aftermath of the collapse, although two years on, the country is returning "strongly and with even more money", making it a major competitor for UK institutions.

The UK's pioneer in the full-campus model is Nottingham, which set up in Kuala Lumpur in 2000 and established its Semenyih campus in 2005. Ian Pashby, vice-president of UNIM, says Malaysia was a safer bet for Nottingham than Singapore.

"New South Wales set up in a high-cost economy, paying Australian salaries and trying to charge Australian fees - plus it had the extra costs of running a campus overseas. We chose to come to Malaysia because it's safe - there's a lower cost base."

However, he acknowledges that even with the support of Najib Razak, the current Prime Minister of Malaysia and a Nottingham alumnus, the project was not risk-free.

"We did face difficulties. We were asking a lot of things that had never been asked before, whether it was questions for the Ministry of ÖйúAƬ or practical things such as software licensing issues - for anyone else coming in now, the groundwork has been done."

UNIM's 100-acre campus was established with Malaysian financial backing - Nottingham is a minority shareholder - and Pashby insists it is not a money-spinner.

"Operationally, it breaks even. It is not paying back any of the investment put in - it cost RM150 million (?25.8 million) to build the campus."

Although it is not a cash cow, Pashby says that the campus, along with Nottingham's branch in China, is an opportunity to demonstrate that the institution is "a truly global university".

"People keep saying to us: 'What's the exit strategy?' There is no exit strategy; we're not going anywhere," Pashby says.

Clack believes it is unlikely that any other UK university will consider taking the same route as Nottingham in the immediate future.

"Nottingham's campus shows what's possible, but it is a huge investment and in this economic climate I don't think we'll see many going for the full-campus model for the time being."

A more popular approach, which is less risky than a campus but a more substantial commitment than a twinning or franchise agreement, is the education-city model.

"There are at least seven or eight UK universities looking to set up faculties here in the two developments that are being built," Clack says.

The projects in question are Kuala Lumpur Education City, close to the capital, and the Iskandar development in the south of the country, across the water from Singapore.

The former is the more geographically convenient of the two, although the fact that it is based in the Klang Valley, which surrounds Kuala Lumpur, means competing in an area that Perring considers to be nearing "saturation point" in many areas of transnational education provision.

The Iskandar development, which is in the less developed Johor region, is a huge government-backed project that reaches far beyond education.

It will have an education city - a "multi-varsity concept" similar to others that have been set up in a number of the Gulf States, for example - which will be made up of eight faculties operated by eight Western universities.

The first institution to sign up was Newcastle University, which signed a deal to develop a medical school there last November. Other UK, European and US institutions are believed to be in talks to join the project.

However, the firm behind the scheme, Iskandar Investment, is also looking to develop residential, healthcare, hospitality and creative-industry zones on its vast site, which is roughly the size of metropolitan London.

There are even plans for a Legoland leisure park and the first foreign branch of Marlborough College on the site, although Khairil Ahmad, senior vice-president for education and healthcare at Iskandar Investment, insists that universities should not be put off by this curious mix.

"The zones are very clearly defined: Legoland isn't next door to Edu City," he says.

Ahmad argues that this "boutique campus" approach strikes a happy medium for institutions that want to move into the Malaysian market without taking the leap of setting up on their own. And he says that there are clear advantages to students studying for a Newcastle medical degree in Johor.

"The full cost of a medical degree will be 40 per cent lower than in the UK. A Malaysian student would pay about RM1.2 million (?206,000) for five years in the UK, whereas it will cost about ?120,000 to do the equivalent programme at Iskandar."

He continues: "In the UK, medical schools have a quota for how many foreign students they can take each year. By setting up with us in Malaysia, it opens the door to Newcastle to allow it to enrol more students."

Ahmad says that in common with many of his countrymen, he is an Anglophile with links to the UK, so it was natural for him to look to Britain for partners.

"I went to school in the UK and our education system in Malaysia is based on the UK model. There is a cultural and even an emotional attachment to British universities - and of course, they are also rated very highly in the world.

"That is not to say that we won't be looking to get American universities in Iskandar - we're trying to get a good MBA programme from the US - but in the case of medicine and engineering, for example, we feel that British is best."

These stand-alone campus and education-city developments are pioneering examples of transnational education, but the majority of the partnerships between institutions in the two countries are less ambitious.

Zita Mohd Fahmi, deputy chief executive officer (quality assurance) at the Malaysian Qualifications Agency (MQA), says these associations have changed over time: "Ten years ago it was a bit of a wild time. There were so many arrangements then, but now universities know what to expect."

Despite this growing maturity, Perring warns that there are still cases of UK universities landing in hot water as a result of agreements with inappropriate partners.

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"We recently had to help to extract a UK institution from a partnership with a local institution that had been entered into without a single visit by the international office. The British university then jumped straight into bed with another institution here which, if it had asked us, we would have told it to steer clear of - and the MQA would have said the same thing."

Despite such hiccups, the majority of partnerships are seen as mutually beneficial for the institutions - and positive for the Malaysian and foreign students who take the degrees.

Fahmi says that post-1992 universities are the most active in the country, and argues that "newer UK universities are more vibrant and oriented, and understand what local institutions here need".

The most in-demand subjects in Malaysia are in business and IT-related fields, but with these areas now well provided for, Clack sees other opportunities presenting themselves.

"Ten years ago, people would come to the British Council's ÖйúAƬ exhibitions and wander around asking the institutions that sent representatives: 'What do you do?' 'Where are you?' Today, students and their parents increasingly come knowing what course they want and who teaches it. If an institution is particularly good in some element of nursing care, for instance, or in a specialist engineering course, prospective students will have found that out themselves. So I would say to some of those niche players, the door is already open to them here."

One local institution to have partnerships with two UK institutions is Sunway University College. It is owned by the Sunway Group, one of the largest conglomerates in Malaysia, which also has quarrying, trading and hotel divisions. It has links with Lancaster University, with which it has offered joint degrees since 2006, and Manchester Business School, with which it set up a partnership in 2005.

Perring says that the deal is mutually advantageous as it allows Sunway to offer degrees accredited by UK institutions, while Lancaster and Manchester Business School benefit from a brand name that is recognised across South-East Asia and the Middle East.

"No one in Malaysia had heard of Lancaster - no one knew what it was - but by partnering with Sunway it has been able to piggyback on its name," he says.

Sunway's vice-chancellor, Jarlath Ronayne, also describes Lancaster as "a bit of a provincial university in Britain", joking it had partnered with his institution because "it wanted to get its name known outside the Pennines".

A former vice-chancellor of Victoria University in Australia, Ronayne grew up in Ireland and studied at Trinity College Dublin and the University of Cambridge, so he has an internationally informed perspective of what is happening in Malaysia. He says that as an Irishman he has seen the bitterness caused by British rule, but is adamant that there is "none of that" in Malaysia, despite its colonial past.

One of his main gripes about the practicalities of partnerships between UK universities and Malaysian institutions is that the bureaucracy involved can be stifling.

"I am used to working in very autonomous institutions and British vice-chancellors would be, too. It can be frustrating - things take time in Malaysia," he says. "You can put in for a programme - you know you are going to get it because the quality is good - but it takes a long time to get approval."

The relationship between the UK and Malaysia may be rooted in history, but it is clear that both countries are looking forward rather than back.

Clack, for example, believes that increasing numbers of UK students will travel to Malaysia to take part of their degrees at institutions tied to their alma maters.

This chimes with the recommendations of a report produced last year by the former vice-chancellor of the University of Liverpool, Sir Drummond Bone, which says that Britain has to start sending students abroad.

"I think that is an integral part of some of the courses that are being set up now, so it will start to happen," Clack says. "It depends to an extent on the vice-chancellor - there are some in the UK who are really forward-looking, then there are others who operate in a more ad hoc way. But they are all starting to realise that sitting back and letting the world come to the UK is a recipe for obsolescence.

"The number of students travelling from the UK is still small, and is never going to be massive, but I think we will see it increase over the next few years.

"The key from Malaysian institutions' point of view is making the most of their unique selling points - for example, showing what they have to offer in areas such as the study of rainforest medicine, tsunamis or indigenous people. Some of these universities own huge chunks of pristine rainforest in Borneo, and if you offer that to UK students through courses in ecology, biodiversity or whatever else, they are going to jump at it."

McCleary agrees, and insists that international mobility and exposure to foreign competition can only strengthen UK institutions - particularly during a recession.

"In the private sector, firms that export are twice as likely to do well during an economic downturn as those that don't - universities that expose themselves to international competition are equally likely to be strong at home, too."

INSIDER VIEWS: 'WHAT'S NOT TO LIKE?'

Students and lecturers at the University of Nottingham in Malaysia come from all over the world, not just the UK and Malaysia.

But those who do travel from the Midlands to the Klang Valley find that not only the climate and culture are different, but also the opportunities open to them.

Andrew Morris, associate professor and deputy director of studies for pharmacy, arrived at UNIM in 2005.

Personal reasons encouraged him to make the move - his wife is Malaysian - but he says that "the fact that the Malaysian campus had the financial clout of the UK campus behind it" was instrumental in his decision.

It has been easy to settle into life 6,000 miles from the UK because "you still have reminders of home; you can get most things in Kuala Lumpur that you can get in the UK", he says.

He also believes that the move has been good for his career.

"I'm gaining experience here, such as helping to establish a school from scratch, that I wouldn't get joining an established university back in the UK," he explains.

His colleague Peter Alderson, associate professor and director of studies for biosciences, arrived at UNIM from Nottingham in 2006.

He says he finds students in Malaysia to be more attentive than their UK counterparts.

"They can see the value of obtaining a degree: their parents tend to be paying for it, and they usually have better attendance records," he says.

Because he is seconded to UNIM from the UK, Alderson says that he is earning "a UK salary". Allowances are also made for accommodation and schooling of children.

Dane Stratton-Powell, a fourth-year pharmacy student from Manchester who graduated this summer, also points to the benefits of moving to the Malaysian campus.

He says that one of the main incentives to come to Malaysia is that it is more affordable than staying at home.

"I pay a lot less for accommodation, for example, and even if I go back for a week at Christmas, living expenses are still cheaper," he says.

He also came to take advantage of better staff-to-student ratios.

"I knew I would get more time with my dissertation tutor here, whereas back home, I would have had to share that time with five or six other students," he says.

Maciej Kokot, a second-year business student from Poland, says the students who took a chance and opted to take part of their Nottingham degrees in Malaysia have no regrets.

"From what we now know, having been out here, it's obvious that we made a great choice," he says.

"If you come for a whole year, you pay half the tuition fees and have a great lifestyle - what's not to like?

"But at the briefings you receive back at home, you're told only about what can go wrong - that you won't see your family at Christmas, that there is malaria here. It discourages a lot of people."

Stratton-Powell adds: "It's a once-in-a-lifetime experience to mix your academic life with travel - I've just come back from a weekend in Hong Kong. In Nottingham, it would have been a weekend in Burton."

RULES OF ENGAGEMENT

The British Council's Guy Perring's tips for UK institutions considering Malaysia

- It takes time. There are no quick wins - there may have been in the past, but not any more

- It takes resources - human and financial

- Local partners often know best when it comes to regulations. Trust your local partner

- Make sure that benefits are accrued on both sides of the relationship

- Build across the spectrum of internationalisation in terms of student and staff mobility and research

- Before you come, speak to the British Council: it will know whether an institution's worth your while visiting

- Speak to the Malaysian Qualifications Agency: its staff will tell you unofficially how they feel about an institution

- Speak to competitors in the UK - it's better for everyone if information is shared

- Don't rely on one friendly visit by a college to set up a partnership: it will come back to haunt you further down the road.

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