India faces shortage of people for high-end industrial work that is based on research and development, Kiran Karnik, president of National Association of Software and Service Companies said on Monday.

"We have around 5,000 PhDs in the country (passing out annually). We all know that India has a competitive edge and companies cannot find the numbers we have in other places, but that is dwindling in high-end areas," Karnik told reporters here on the sidelines of the Nasscom Quality summit.

He said about 300,000 engineering students graduate annually, "but a fewer number of people pursue masters or doctorates, and only about 5,000 students are in PhDs."

Only about seven to eight people of every 100 were employable in the business process outsourcing industry and "the industry has the luxury of hiring the best seven or eight, but when the industry needs to expand in the long run, they would find it difficult," he said.

In an effort to address these concerns, he said, Nasscom had begun talks at the University level in improving the syllabus and quality of faculty, by adopting the models of Indian Institute of Information Technology at Hyderabad and Bangalore.

Karnik also said the industry was in discussions with the central and state governments on improving infrastructure, but the pace of work was very slow.