Does India Have A Talent Shortage?

Conventional wisdom dictates that the United States and the European Union face an onslaught of highly talented and low cost IT resources from India.  Indeed, many Western companies have moved their operations offshore or outsourced their operations completely. 

According to an article in the Los Angeles Times titled India’s Looming Talent Shortage (registration required), not everyone in India is that optimistic.  The article quotes Lakshmi Narayanan, President and CEO of Cognizant Technology Solutions.

[A] shortage of talent is looming that could put a dent in India’s reputation as the world’s information-technology outsourcing champion. Three or four years from now, Narayanan and others forecast, qualified engineers in India are going to be at a premium as companies like his vie for their services to sustain the industry’s remarkable growth.  “Clearly there’s going to be a challenge,” said Narayanan, the president and chief executive of Cognizant Technology Solutions Corp., which produces business system software for such clients as Wells Fargo & Co., Aetna Inc. and ACNielsen.

The article goes on to point out that while India does indeed graduate a large number of IT students, only between 10 and 25% of these students are qualified to work for a multi-national, primarly because of insufficient English language and other soft skills.

It remains to be seen if these will be a serious impediment to continued development of the Indian IT sector, but for now Western companies continue to source their IT requirements from low-cost countries like India.  This is a development worth watching.