Indian executives could be in danger of pricing themselves out of the market with salary demands that are so high they are forcing Indian companies to look to cheaper expatriates to fill senior roles.
Preety Kumar, managing partner of Indian headhunter Amrop International, told the Financial Times that "in the last three years the proportion of expatriate managers hired for positions in India has gone up from 5 per cent to 15 per cent."
"As a rule of thumb, country heads now get $300,000-$400,000, and frankly you can get any expat for that money," said Ms Kumar. "In many jobs, an expat comes cheaper or at a similar price. If you don't tap that market, you're missing a chance to expand your leadership pool."
This surge in pay demands has been accompanied by a wider row over executive followings calls by India's Prime Minister, Manmohan Singh, for India Inc to trim the salaries of its top executives.
But in a retort that will sound pretty familiar to European and American ears, Sunil Mittal, head of the Confederation of Indian Industy, (whose salary as head of the Bhati Group doiubled last year) said that "Salaries cannot be legislated."
"There is shortage of skill at the top level and more specifically in the service sector, which is why pay packages of senior executives are high," he insisted.