Yes Arun,
As of January 2010, an International student would have to bear the burden of AUD $18,000 per year living expenses as opposed to earlier AUD $12,000 per year. This is a huge increase in cost - 50% increase.
So if you are planning to go for 2 year course then be prepared to show at least AUD $36,000 + the tuition fee. I guess that in itself might make it little unattractive for students.

Can't really say. According the the Australian Minister of Immigration and Citizenship, Mr. Chris Evans, the increase was decided based on extensive analysis done by their department and is more in tune with the current living standards.

But on the flip side, the ministry is also trying to control the number of poor students that enter the country. According to Chris Evans, number of unscrupulous agents are making false promises to students and helping them create fraud documents. They would like to curb that immediately.

It remains to be seen whether that is achievable or it would fall flat on its face and help increase the fraud.

Look at the article for more information http://collegetou.com/australia-news/required-funds-for-australian-student-visa-increases

I can understand your anxiety. You can try UK or even NewZealand.
UK is generally 1 year MS course. Same with NewZealand. But NewZealand is more of a Diploma or Polytechnic market. It is difficult (not impossible) to get into MS in NewZealand.
Usually the MS requirements in Universities are very high... like 75% average with NO backlogs etc.

You could be right... for all your know.
Students may resort to more financial frauds leading to more rejections.
But my strongest advise to you students... PLEASE REFRAIN from such activites.
It just leads to more headaches in the future. I have seen students getting rejected from UK with strong letters banning them from future application for another 10 years. So in now way or form they can apply again within 10 years. That's NOT pretty on a passport.

Be careful.