By and large, executives in India1 think that the opening up of the global economy presents them with huge opportunities for growth. A McKinsey Quarterly survey, which polled more than 9,300 executives around the world, including 537 in India (Exhibit 1), shows that Indian business leaders are much more optimistic about the future than are their international peers. Yet rather surprisingly for a country with one of the world's largest labor pools, they see the high cost and low availability of talent as the single greatest constraint on their companies—a problem that worries them much more than it does their counterparts around the world.2
With a relatively young population of 1.1 billion people, India has a vast reserve of workers, but our Indian respondents say that finding the right ones will be difficult. Indeed, 81 percent of them (as compared with 73 percent of the global panel) told us that the cost and availability of talent will be a significant constraint on business over the next five years. Indian IT executives feel this kind of...