Vikas Rambal, a Perth-based fertiliser tycoon and major cricket sponsor, also said that Australians only ever attacked anyone they found "too offensive."
Indian groups in Australia have slammed his comments as 'nonsense', The Age reports.
The attacks on Indian students, which have mainly occurred in Melbourne, have caused a huge public outcry in India and have seen assurances given by Prime Minister Kevin Rudd to his Indian counterpart Manmohan Singh that they were being properly investigated.
Rambal, whose company Perdaman Industries plans to build a 3.5 billion dollar urea plant in Collie, south of Perth, told students at his former university in Nagpur on Thursday that Indian students had provoked the attacks on themselves.
"Who would want anything to do with a person who, although he has been sent to study, manages to earn a few hundred dollars driving taxis and spends them drinking or making merry in the worst possible ways," he said.
"The Australians never attack anyone unless they find the person too offensive," he said.
Federation of Indian Students of Australia president Amit Meghani said Rambal had no idea of the reality of life for an Indian student in Australia.
"I''d like him to spend a couple of weeks as a student, living five people to a room, going to a university with no computers, and walk home late at night not carrying a mobile phone. Then he can see how things work out," Meghani said.
Victorian police commissioner Simon Overland and Western Australia Ethnic Communities Council president Ramdas Sankaran, a Malaysian-born Indian, said Rambal's comments were 'nonsense.'
"I really find it astonishing that someone would say that," Sankaran said.
"Given that Australian authorities themselves accept what has happened, why blame the victim. The realities are various minorities are being attacked," Sankaran added.
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