First the good news. Corporate India is handing out handsome hikes in pay packets this year, so if you haven't received intimation yet on what your increments in 2006 are likely to be, remember you read it here first.

Across most platforms, modest escalations will be in the range of 15 per cent, so yes, you can consider changing your car for a better model, or take a fresh loan on the beach house you've been promising your wife.

Of course, if you're considering a switch, you know you can negotiate an even higher raise, but if you're part of India's sunrise industries - real estate, financial services, infrastructure development, retail - you can pop the bubbly now.

Because there's nothing holding you back from raking it in huge this year. Analysts suggest that even at base levels, salaries are rising in the 20-40 per cent bracket, but at senior levels you could make much, much more - as much, in fact, as 200 per cent and still asking.

And behind the spike is a simple phenomenon - there's just no supply to feed corporate India's voracious appetite for skilled manpower. Companies in India are growing much faster than in more mature markets, and as a logical extension promotions and higher increments are signalling a more vibrant job market.

At entry levels, attrition rates are high; middle management is stuck with the issue of loyalty, resulting in higher salary bandwidths simply to retain one's employees, while at the top end you could find yourself waiting anywhere from six months to a year to fill vacancies or fill up posts for new jobs.

And still, the good times have only just got rolling, according to some, and India's orgy with pay-packets will only get wilder as players like Wal-Mart and Bharati-Tesco, for instance, start hiring in the retail sector.

Retail, the business of making money, could be the biggest money spinner for India's crop of management grads who're looking to the malls and marts and hypermarkets for a future. And if you're part of the country's banking and financial sectors, you can simply sit back and auction yourself to the highest bidder.

With a large number of banks entering India for the first time, and financial services set to grow at a scorching pace, there's simply no supply that can keep up with the demand for chief executives in the industry.

Already, there's talk of bonus surges as high as 40 per cent in banks (though this may be a one-off phenomenon, unlikely to last beyond this year), but one thing's for sure: making money for others just got much more lucrative for those who manage their assets.

So, just how much is too much? Corporate India is either not telling, or it doesn't know yet, or is holding out for more information. But with the top gainers in graduating students now several notches higher than in previous years (Rs 90 lakh for an IIM student; Rs 1.04 crore for an ISB grad), those salivating figures are head-turners that have the whole nation talking dirty money. Where are the jobs that pay such handsome compensations?

ISB grad bags Rs 1.04 cr salary deal
$185,000 offer takes the cake at IIM-A on day zero

That's where the party gets a little murky. For starters, head hunters feel, the compensation appears higher because companies no longer talk in terms of salaries + perks, but number crunch with CTC or cost to company.

"So suddenly numbers have become important and that makes it sound like salaries are rising at astronomical rates," points out a Delhi-based hiring consultant.

Myth number two is that the IT and knowledge-led industries are at the head of this surge. Au contraire, compensations here are scaling down somewhat.

Says Anil Jalai, head compensation and benefits, Wipro [Get Quote] Technologies: "There could be some toning down in salaries, as the IT industry has already seen a double-digit increase in compensations."

If that sucks, this could hurt some more. "In the IT sector today, those with hot skills command a 20 per cent premium over those employees who have only some plain vanilla skills," says Gulshan Vohra, who heads data information services at Watson Wyatt.

And now, a Rs 86-lakh starting salary

Adds Praveen Malhotra, managing partner of Positive Moves International, "You could leverage substantial jumps at mid- and low-levels in the IT sector, but at CEO levels, they're more realistic at 20-25 per cent."

As for all those MBAs hoping that the vast FMCG market is their gold ticket, here comes the rub. "In this sector, there is no dearth of people, nor is there much movement of people within the sector, as a result of which there is no hike in salaries," explains Mohit Mohan, vice-president, Gilbert Tweed Associates.

Yet, there are "wild" salaries being offered in the market, and whispers are doing the rounds of Mukesh Ambani's "crorepati councillors" who have been lured away with compensation packages that are the talk of town. Reliance [Get Quote], on a hiring spree for its new businesses (retail and SEZs, what else?) has picked off Raghu Pillai (from Pantaloon [Get Quote]), Rajeev Karwal (formerly of Electrolux), Gunendra Kapur (ex-Unilever), Bijou Kurien (from Titan) and Sanjeev Asthana (of Cargill India) and a whisper campaign has it that these incumbents are being paid anywhere between Rs 2.5-5 crore (Rs 25-50 million).

There's more to life than fat salaries

As salaries? If these are the new benchmarks, they're certainly high, but consultants say Reliance may be making a statement of intent for its business heads as potential business partners for whom profit sharing might be part of the deal. "It's all a game of demand and supply," confirms a senior consultant.

If that's what it boils down to, then clearly the advantage is out there for those in the real estate and infrastructure industries. "These are the two sectors that are witnessing a war for talents and the hike could be even more than 35 per cent for private banking companies," says E T Anil Kumar, north Indian head for Ma Foi Consultants.

There's a huge boom in the industry, and while mega-investments by organised players such as IL&FS, Unilever and Parsvanath might have led to the shortage of skilled hands in the sector, the entry of foreign players and the announcement of mega-projects by DLF and Reliance isn't going to hurt those looking for even higher compensations in the trade.

Fat salaries fail to lure these IIM grads

Poaching is the big problem in real estate. "It's very intense because there are a limited number of hands who change jobs frequently," confirms N S Rajan, vice-president of HR at Ernst & Young. And if each time they're poached on an average 40 per cent hike, their take-home salaries, according to industry estimates, is very, very high indeed.

The scorching pace set by realtors and developers is only matched by the financial sector, where new entrants have caused a sucking out of key employees from existing companies.

Citibank, for instance, lost 10 executives to SG Bank over the last six months, and the recent entry of other international banks couldn't help existing players. Analysts suggest a steep rise in salaries, and the highest compensations are expected by those employed by Citibank and ABN Amro.

"With new players entering areas like asset management, general and life insurance, and retail banking," according to Praveen Malhotra of Positive Moves International, "this sector has witnessed a paradigm shift in talent search and compensation levels." His estimate: inflation levels for chief executive positions could set back employers by anywhere between 30-100 per cent over previous salaries.

And so, "Companies are going out of their way to retain talent because the opportunity costs of losing good talent and the costs of hiring, training and orientating new people is very high and cumbersome. So companies are offering incentives like high retention bonuses, international careers, and hikes ranging anywhere between 15-40 per cent, the average being in the 20-25 per cent range for senior executives," says Malhotra.

If some years back the biggest surges were in the IT, telecom and insurance sectors, followed more recently in the aviation and media segments, this year's top earner is most likely to be the financial sector, according to Sanjeev Bhikchandani, CEO of naukri.com.

"There is a global play of executives in the market," explains Gita Dang, senior client partner, Korn/Ferry International, "who are demanding and delivering as per global packages. India is fast catching up as a hub for churning out global executives."

The big push in retail, according to Nihar Ranjan Ghosh, senior VP-HR, RPG Retail Sector, could be because India's poor retail penetration in the organised segment has been only 3 per cent. No wonder salaries have mushroomed anywhere between 30-200 per cent according to him. But though these may settle down somewhat towards the end of the year, Ghosh is of the opinion that salaries might get split into guaranteed pay and variable pay.

"Companies will look to innovative rewarding mechanisms," he says, "and could choose ESOPs as they are a no-cost, long-term benefit option." Anil Jalali agrees that ESOPs are here to say, certainly in the IT industry, but that "variable pay would see an increase" too among organisations where the top managers' overall compensation could be linked to performance.

Adds Sanjay Jog, HR head, Pantaloon Retail, "In the retail industry, the pressure to hike compensation is on the merchandising function as there aren't enough people with that kind of domain knowledge.

Whether it is about hiring new people with some experience in this organisation, or about progressing the careers of existing guys, the people in this department receive a compensation that is in excess of 20-25 per cent. We are forced to do this as everyone and his uncle is getting into retail."

But before you get seduced by the easy pickings, be warned that the hype about salaries may be just that. Corporate India might be sizzling for now, but the compensations don't come cheap. For, though you might command a hefty hike, how will you deliver unless you can hold on to your own key people in turn?

This means that at the highest levels, the stress factors are humungous. It means having to deliver no matter what, eliminating stress-free time zones like weekends, while the global working platform means your keeping up with Ram, Hari and Shyam in India as well as Tom, Dick and Harry in San Francisco, Japan and Australia, which translates into working round the clock, often without a break.

Bhikchandani also cautions that the hype around salaries, and particularly in the case of those from B-schools, may just be a case of misleading information. "Before one comes to any rupee equivalent of these salaries," he cautions, "five things need to be considered - bonus, the cost of living in the country from which the job offer has been made, the taxes in that country, whether there are ESOPs and (particularly in the case of students) his job experience."

And adds: "At those salary levels, the risks are equally high. The newly appointed business heads assume the role of entrepreneurs in such cases, and if they don't translate their efforts into viable and sustainable business, they may even lose their jobs."

Even so, the compensation may simply not be enough. "Salaries in India are lower than those in Western countries," says Bhikchandani. Besides, if you're travelling out on those handsome dollar salaries, there's another downside - living in the West is far more expensive than in India, and in all probability you'll end up doing the housework yourself.

Finally, of course, if salaries continue to burgeon, companies could be reduced to seeking their top managers from overseas. And at such high levels of compensation, it may no longer be an iffy option. In the IT industry, Wipro's Anil Jalali points out, "Companies will hire talent from wherever it is available, overseas or in the country."

And Pantaloon has already begun the process of bringing in from overseas those people who have experience in managing large, fast-running companies to run the systems and processes. "We already have 10 overseas returnees in our organisation with around 12-20 years of experience," says Sanjay Jog.

"Eight came because they believed in the growth story, which was the real attraction, and not the compensation packages." And if that becomes a trend, you're warned: it's time to open the bubbly, yes, but don't get too high on it.

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