There is a story being told at the Indian School of Business (ISB) in Hyderabad. When a student turned down a big-ticket offer from an MNC and took up a common-or-garden job with an Indian company, he was rebuked by a member of the placement office. “You are letting us down,” he was told. “The average salary will fall because of you.”

That was in the days when these B-schools were displaying their salary successes as trophies at press conferences. Sanity has been forced on them now. First, the students have protested against this unwarranted one-upmanship amongst their deans and professors. Second, too many of them are rejecting dollar jobs for the humbler rupee variety. “Growing preference for Indian locations and entrepreneurship marks placement 2006 at IIM Ahmedabad,” says MBA portal CoolAvenues.

IIMA has long been ahead of the B-school pack. Today, however, IIM Calcutta is patting itself on the back for the traditional “success” ? “IIMC comes of age on Wall Street, places 30 grads across bulge bracket banks.”

For all the hoopla about salaries, however, recent surveys show that India is really at the bottom of the pile when you compare numbers at a senior level. A Mercer Human Resources Survey says that finance directors in the US earn an average of $324,000 annually, against $63,800 in India.

Even the numbers from Brazil, which is a lesser member of the BRIC (Brazil, Russia, India, China) pack, are higher at $205,700. There is a similar skew for other senior positions (see table).

Isn’t there an anomaly surfacing from these numbers? The highest salary for a B-school grad from India this year was $233,800 recorded at ISB. But the Rs 1 crore-plus the worthy gentleman is getting is close to the average pay of a full-fledged HR director in the US. The truth is that the Rs 1 crore figure could have a large number of invisible components. It’s cost to company (CTC). In an extreme case, a company even included the cost of travelling to the campus for recruitment in this figure.

Meanwhile, in the US, B-school placements have recovered from the slump. The Class of 2006 is in clover. Grads are getting several offers and the starting pay is in excess of $50,000, not including bonuses.

According to a survey by the National Association of Colleges and Employers (NACE), undergraduate hiring across the board is expected to increase by 14.5 per cent this year. The service sector is most in demand. Starting salaries have kept pace. Accounting grads have got a 6.2 per cent increase, finance 11 per cent and MBAs 3.9 per cent. “Even poets are graduating into a stronger market,” says BusinessWeek. “The average salary for liberal arts majors as a group is up 6.1 per cent over last year.”

If you look at the absolutes, the average starting salaries are $46,188 for accounting, $45,048 for economics or finance graduates, and $40,976 for B-school grads. The “poets” mentioned earlier can expect $30,985.

There are two lessons in all this. One, in terms of salaries, we still have a long way to go. Two, don’t buy all the Indian B-school hype. When they start claiming that freshers are earning more than CEOs of most Indian companies, they have clearly gone over the top.