Blind Chinese dissident lawyer was taken in as a student at New York University so he could leave China for the US

The blind Chinese dissident Chen Guangcheng – whose escape from house arrest to the US embassy in Beijing sparked a diplomatic crisis in 2012 – will be leaving his position at New York University at the end of this month, the university confirmed.

Chen, a self-taught lawyer, has been a special student at the university's US-Asia Law Institute since May 2012. The deal was struck so he could relocate to the US from China without worsening diplomatic ructions between the two countries over the case. He is working on a book, which is expected to be published later this year.

"We were pleased to offer Mr Chen and his family a place to come and study and support his transition to the US when he first left China, based on a pre-existing relationship he had with scholars here," NYU spokesman John Beckman said. "But NYU and Mr Chen had discussions beginning last fall that NYU could not support him indefinitely."

Beckman rejected reports that Chen's departure was related to the university's development of a campus in Shanghai, calling the claims "fanciful and false". Chen was not reachable for comment Thursday night.

Professor Jerome Cohen, a family friend and NYU law professor, said Chen's agreement with the university was always to give him and his family a year to "get their feet on the ground and transition to a more permanent position".

"No political refugee, even Albert Einstein, has received better treatment by an American academic institution than that received by Chen from NYU, and I am grateful to the university administration for its extraordinary generosity, which could not reasonably be expected to go on indefinitely," said Cohen, adding that Chen was choosing between "two attractive opportunities" for his future.

Bob Howe, a spokesman for New York-based Fordham University, confirmed Chen was "in negotiations" with Fordham Law School's Leitner Centre but did not know what kind of position was being negotiated. It was unclear on Thursday what the other opportunity was.

Chen made international headlines in April 2012 when he escaped from house arrest. He had angered local Chinese officials by documenting complaints about forced abortions. The extrajudicial house arrest followed his release from prison.

His escape to the US embassy triggered a diplomatic standoff over his fate. With secretary of state Hillary Clinton in Beijing for annual high-level discussions, officials struck a deal that let Chen walk free, only to see him have second thoughts. That forced new negotiations that led to an agreement to send him to the US to study law at NYU.

Human Rights First gave its 2012 human rights award to Chen in October 2012. The award was presented by the actor Christian Bale, who had tried to meet the activist in China but was turned away by officials.