India’s Lost Talent: Analysing Brain Drain and its Impact

In the current day and age, a new phrase has emerged, gaining massive traction across the globe. Brain drain is a condition where a nation is deprived of its highly skilled citizens due to their departure to other countries for a host of reasons, including economy, policy gaps, personal interest, and better opportunities. Globally, India is known as a hub of excellence, with institutes like IITs, AIIMS, and IIMs producing world-class talent.

The global influence of the Indian diaspora is not unknown. Today, Indian-origin citizens are at the helm of affairs in world-renowned companies such as Apple, Microsoft, and Google. According to the OECD, India exports the highest number of highly educated migrants, amounting to 3.12 million across the globe, that represents 65% of the global share. But this worldwide success story poses a grave question: What does their absence mean for India?

As India aspires to become a Viksit Bharat by 2047, it must urgently rethink how it engages with global Indian talent.

While the world benefits from India's finest minds, India today fails to recognise the same talent and curate an environment to foster and harness their full potential. Should brain drain be viewed as a national loss, or can it be reimagined as a strategic asset for India on the global stage?

BEYOND THE BORDERS, REDRAWING THE DESTINY

UNESCO defines brain drain as an uneven scientific exchange where skilled professionals migrate from less developed to more developed nations in a one-way pattern. India, the postcolonial state, had envisioned national institutions like the IITs and IIMs to be the backbone of India’s reconstruction. However, these same institutions became pipelines for the flight of capital, both intellectual and economic, to the West. In fact, in the late 90s, the World Bank even proposed an exit tax on every IIT graduate leaving India, estimating the Indian government could earn a billion dollars a year from it.

However, the idea of brain drain in India emerged much before independence. The colonial rule shaped the very mindset of the modern Indian professional, promoting the idea of ‘an ideal subject’, someone who retained Indian appearance and speech but adopted Western modes of thought.

It was Lord Macaulay’s Minute on Education in 1835 that structured the Indian intellectual framework around Western beliefs. The deep-rooted colonial value assigned to Western education continues to shape the Indian aspiration.

Today, the Harvard acceptance is a family-wide celebration. Immigration to the US, UK, Canada, and Australia is a benchmark of success. But in the past two decades, we have seen a shift. In 2023, 9.38 million Indians returned to India, a significant rise from 5.48 million in 2021. There has also been a change in the long-term foreign settlement of IIT graduates. As per a survey conducted by Insight, with a sample size of 20,000 graduates, in the early 2000s, 41% settled abroad. For graduates post-2010, that number has dropped to just 15.8%.

With a rise in the startup ecosystem, increased government support, digital infrastructure, many NRIs are returning to India. Expat Indians who worked in Silicon Valley are now returning to build in Bangalore. Rather than relying on one ecosystem, they now move across multiple hubs: Boston, Mumbai, Bangalore, Tel Aviv, and Singapore. The elite Indian student still studies abroad, but returns, equipped with foreign education, ideas, and networks, and the aspiration to fuel India’s growth.

India has also strategically positioned itself as a fork in this circuit, partnering with the US, to promote joint research and investment. The San Francisco-Bangalore AI Research Initiative is one such project that aims to build an AI innovation corridor between India and the US. 

PUSH AND PULL FACTORS

The great Indian migration poses a detrimental threat to economic progress and innovation to steer India ahead. Today, India is being deprived of its knowledge economy. It loses between $35 to $50 billion yearly owing to lost productivity, foregone economic growth and investing in subsidised higher education of students who eventually end up migrating.  

A primary driver behind migration is the lack of higher education opportunities.

While India today has state of the art institutes specialising in STEM courses with global recognition such as the IIT and the IIM, the seats in. In 2025, India's top institutes offer only 17,760 seats while around 1,476,557 students appear for the JEE examination, amounting to just one seat  for every 83 candidates. This stark ratio underscores the severe limitations of our higher education capacity.

Such limitations to premium education further prompt students to seek opportunities abroad. Coupled with the lack of premium colleges in nearby rural areas and the use of outdated study material, reflects a deeply entrenched systematic problem. According to the NBER report, at least one-third of the graduates from IIT,  migrate abroad. 67% of highly qualified professors today cite their interest in seeking jobs abroad rather than in pursuing and imparting quality education to students in India.

While the fees for private colleges skyrocket, the government colleges suffer from a dearth of quality infrastructure, practical labs, and full-time teaching faculty, further steering qualified minds to opt for opportunities abroad.

As per a CAG report on “Performance Audit of Setting up of new Indian Institutes of Technology (IITs), the eight IITs built between 2008 and 2009 lack in infrastructure, which has further affected the student intake and the quality of the education being imparted. Many state engineering colleges lack mechanical or advanced workshops, and even basic amenities such as washrooms. The abysmal infrastructure is not just limited to universities; however, bad living conditions steer a person towards deliberating upon the scope beyond the borders.

The scope of income expansion with the same education qualifications as an Indian working in India entices individuals to move around. Today in India, an MD specialist could earn Rs. 30 lakhs annually, which is around USD$36,000, in a startling contrast to an MD specialist with the same qualification earning nearly USD$500,000 annually. An average engineer in the USA today earns an annual salary of USD$107,459, while an average engineer in India annually earns between USD$31000-45000.

An average aeronautical engineer in India today earns between 4 LPA to 25 LPA (in rupees), meanwhile, an aeronautical engineer in the USA earns around 84.7 LPA ( in rupees) annually.

The cream of every graduating batch from top institutes in India is hired by firms abroad, or students willingly choose to pursue further education abroad, depriving India of its most crucial human capital.

Low-income scope for academic researchers and highly qualified minds further prompts them to take such decisions. A robust research system with ease of patenting is key to innovation and technical growth. Despite improvements in the research and development sector in the past 10 years, India's Research and Development expenditure even today ranges around 0.6-0.7%.

A dearth of financial support impacts further research and investigations,  impacting the product development, scaling,  and testing. India realises this and has taken steps in the right direction with allocation of budget for science and technology in 2025 at Rs. 20,000 Cr from the average Rs. 6,000-8,000 Cr budget allocation for the ministry. 

In 2024, over one in three people who migrated abroad from India were women. Today, nearly one quarter of migrant women live in the USA, and the gender parity between men and women migrating to the USA is almost equal. Lack of economic progress, job openings, better opportunities, and cultural barriers to stay home emerge as barriers against women's empowerment. These immigrant workers, in the hope of better opportunities, move abroad to seek job opportunities in primary, secondary and tertiary sectors. 

INDIA'S LOST TALENT: A SUBOPTIMAL INVESTMENT

India follows the welfare policy and recognises the right to education as a fundamental right under Article 22A. To ensure that education is not hampered due to financial constraints, subsidised education is imparted across various fields, including healthcare, medicine, engineering and pure sciences. 75-80% of the operational expenses of IITs and IIMs are funded by the Indian government, along with regular budgetary grants by the Ministry of Education.

India invests in education to foster innovation and technical growth; however, these subsidies go in vain when the majority of graduates from these institutes choose to pursue further education abroad and settle there. 

India suffers from a massive wave of brain drain in the field of healthcare by being the largest nation with the most doctors, domestically trained, migrating abroad.

According to the OECD data, 74,455 expat doctors, with two-thirds of these professionals, are currently settled in the USA, and 19,000 headed to the UK. The mass departure leaves a detrimental impact on India with a loss of top-notch medical services, a decrease in services in remote locations and limiting medical research and innovation. India is not extracting the most through brain gain and enticing abroad scientists to pursue a career in India. A lack of good infrastructure, higher pay with low taxes and assurance with sufficient investment are what still limit India from being a hub for international scientists to show interest.

Indian tech companies today add around USD$198 billion to the US economy, a sharp depiction of the brain drain and its ramifications on Indian economic progress. The majority of the top AI companies in the United States have been founded or co-founded by Indian immigrants. 42 out of the 2025 Forbes ‘AI50’ list comprised startups established by immigrants of Indian origin. The dearth of appropriate mechanisms to harness innovation and provide incentives to prevent the exodus of our knowledge system, today directly impacts our technological progress and breakthroughs as against the rest of the world.

AI: THE NEW FRONTRUNNER

India is rapidly emerging as the hub of AI research and stands at the 13th position globally in the AI talent race. Between 2016-2023, India has seen a 263% upsurge in its AI talent; however, India risks losing the artificial genius to brain drain. The majority of professionals are drawn to pursue their career abroad, particularly in the US, due to the thriving tech ecosystem, access to cutting-edge research, higher pay and venture capital environment.

With a dearth of culture networking events, cross-board partnership and on-ground adoption of AI with lowering the restrictions to entry and the bureaucratic control, India today still needs to take steps in the right direction for optimal utilisation of its human capital.

A SILVER LINING

Brain drain, however, also acts as a blessing in disguise, establishing India's soft power with the world’s largest diaspora, enabling India to influence policy-making, decisions across the globe. Furthermore, India today earns the highest amount through remittances across the globe, with USD$129.1 billion of remittances received in the year 2024.

Indian diaspora today steers the investments in India, offering knowledge and experiences and growth ventures from all across the world.

Indian migrants and workers further create business and trade links with nations abroad, providing Indian investors with opportunities for investments with a base already set up. Brain drain across the globe enables Indians to interact and imbibe knowledge from different means, to curate and innovate and return to India with a new fervour to not just rejoin but rather to lead the legendary path to renovation.

Indian-origin CEOs of world top companies, such as Google, share a common interest in India's growth story and do their part through active support and promotion. Google spent USD$75 million on women-led Indian startups. Indian-origin CEO Ceaser Sengupta, today, with his startup on digital wealth, Artha Foundation, is backed by Google and Sequoia Capital India. Though India still has a long way to go.

CHINA: REVERSING THE BRAIN DRAIN

China is amongst the top nations suffering from the crisis of brain drain with 70% of its overseas students never returning. To counter the paucity of human capital, China adopted schemes and structural overhaul to curate an environment to foster young minds. Post Tiananmen 1989, the government policies restricted and discouraged the return of migrants. Understanding the grave ramifications of brain drain, Deng Xiaoping advocated for return migration as a national policy.

Chinese policies focused upon institutional mobilisation with setting up educational bureaus across 38 countries and Guangzhou Science and Technology Convention as means to connect overseas scholars with the local industries. Financial policies including the 100 talent programme, offered incentives namely, housing perks, 2 million Yuan grants, PHD advising,  thus instituting an environment for innovation and technical progress.

China restructured its entire policy design to incorporate and incentivise itself as a hub of technology and innovation, succeeding in reversing the brain drain.

POLICY INITIATIVES BY THE GOVERNMENT OF INDIA

Present-day India too acknowledges brain drain and its far-reaching impact on the economy and has devised schemes to counter the same.

VAJRA Scheme: Visiting Advanced Joint Research Faculty Scheme launched by the Department of Science and Technology, aims at bringing overseas researchers and scientists to India to collaborate on research projects in Indian institutions. With incentives such as financial support, monthly pay, the scheme aims at attracting overseas researchers and NRIs to join in the research and development in the R&D ecosystem of India.

Resident Foreign Currency Account Scheme:  The scheme, approved by the RBI in 1992, offers individuals permanently moving back to India with an incentive to manage foreign currency earnings without the need to convert them to Indian rupees. This enables Indians to continue to stay in the country while pursuing a career abroad.

Ramanujan Fellowship Programme: Ramanujan Fellowship Programme aims to attract Indian researchers and Indians who have moved abroad to return to the country and take up research positions in India, therefore enabling scientific innovation and progress of the country.

INSPIRE Scheme: Innovation for Science Pursued inspired research scheme focuses on fostering young minds and encouraging them towards the field of science through scholarships and fellowship programmes to harness the human resource pool to further build upon.

Prime Minister’s Research Fellows (PMRF) Project:  Launched in 2018, with a key objective to transform brain drain to brain gain, the programme focuses upon fostering young individuals with a knack for STEM research, pursuing PHD in Indian universities. The scheme provides the individuals with limitless and unmatched opportunities to collaborate on matters of national significance.

POLICY RECOMMENDATIONS

Red-Tapism: Bureaucratic control and constraints are one of the key factors behind the sluggish expansion of India's technical growth and the loss of STEM graduates to universities abroad. India must decentralise the regulations with ease in expansion and business as key anchors.

Public-Private Collaboration: The Majority of graduates from IITs and IIMs move abroad seeking higher education from state-of-the-art institutions, and then are pulled in by the multinational corporations. To counter that, India today must initiate collaboration between public and private enterprises with viable alternatives to higher education in qualified institutions, along with incentives such as fellowships and scholarships to grab the students' attention.

Higher R&D Funding: India is taking the step in the right direction, however, being a welfare economy with a focus on subsidised healthcare and education, impacts the budget allocation towards research and development. Research and development play a critical role in initiating the growth of entrepreneurship and startup industries. The government could collaborate with private companies to further expand its investment. This could be achieved through expansion of tax incentives, co-funding research centres, CSR funds being allocated towards educational R and D, working upon innovation clusters and networking to further popularise and curate a tech ecosystem.

The phenomenon of brain drain today is a matter of grave importance as India strives to become a Viksit Bharat by 2047. With a complex working of both the push and pull factors, India today is becoming a talent agent that invests and produces highly skilled and qualified human capital for the rest of the globe, leaving India bleeding. Only through curating an ecosystem by forming a multi-layered approach could India truly counter the trend and convert brain drain to brain gain.

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BY ANANYA SHARMA

TEAM GEOSTRATA

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