NEW DELHI When the MBA students at Indias top business schools began their studies their future was full of promise as companies tripped over each other to lure graduates.

But 24 months of study and a financial meltdown later, prospects are glum for the estimated 120,000 business school graduates who will enter the job market in March after their final exams.

`Everyone is scared,` said Neha Verma, who is one of a crop of 20-something management graduates at a New Delhi college.

In past years, firms riding the wave of Indias economic surge would fight over the newly minted talent produced by Indias prestigious business colleges as they scrambled for an advantage in a country with a lack of middle-management talent.

Nowadays, jobs for graduates are drying up as Indias economy feels the pinch of the global recession.

`The fact is there is a hiring slowdown,` said Sudip Bandyopadhyay, chief executive officer of financial services firm Reliance Money, a unit of Reliance Capital.

`Anybody denying it is just trying to bury his head in the sand.`

While Reliance Money is recruiting for recently launched wealth management services, Bandyopadhyay said his company is an exception in a bleak job market and slowing economy.

A survey by global staffing-services firm Manpower Inc says Indian firms are likely to slow their hiring to a 3- year low in the first three months of 2009, further evidence the global economic slowdown was taking its toll.

After growing at 9 percent or above for the past three years, Indias trillion-dollar economy, Asias third-biggest, is showing consistent signs of slowing.

Squeezed by plummeting demand overseas and expensive credit at home, factory output contracted in October, the first year-on-year drop in more than 13 years, while exports and sales of cars and buses have fallen heavily.

Economists and government advisers expect growth for the fiscal year to the end of March to brake sharply to around 7 percent, and the governor of the central bank recently said 2009 would prove more challenging than a `difficult` 2008.

EMPTY CORRIDORS

In India, management and information technology campuses are usually a buzz of activity from November as employers recruit students preparing for their finals.

While students at premier academies such as the Indian Institutes of Management (IIM) — the Ivy League of the nations MBA schools -- may escape the worst of the downturn, job fairs at second-tier colleges are attracting few takers.

`The ones who were expected to come have either deferred their visit or are not coming at all,` said 25-year-old Abhishek Chaudhary, who studies at the Institute of Marketing Management in New Delhi.

Less than a dozen companies were recruiting at Chaudharys institute in 2008, down from 50 last year, he said.

`Only 25 students from my batch of 120 have got offers,` said Pawan Nahata, another management student in Indias capital. In a normal year, everyone would have been snapped up by January, said Nahata.

`Fearing a volatile environment and fast changing business scenario, many companies have not decided on their numbers to recruit,` said Munish Bhargava, placement adviser at the Indian Institute of Foreign Trade, a government-run business school in the capital.

Fearing the usual route to a comfortable career may not deliver, students are uploading resumes on online job portals or are approaching employment agencies, while others scale back their salary expectations.

DREAMS SHATTERED

London-based Mohit Mathur saved for three years to pay his way through a good B-school.

His dream came true when he was selected for an executive MBA at the Indian Institute of Management in the western city of Ahmedabad, a prestigious business school that is sometimes called the `Harvard of India.`

But the 30-year-old is worried the job market may not have recovered by the time he graduates in early 2010.

`We might pass out either at the peak (of the financial crisis) or when it is close to ending,` said Mathur.

Some 290,000 candidates took the admission test to the top business schools in India in November, compared to 230,000 in 2007, Indian media reports said. They were competing for just 1,700 places at the seven IIMs, the countrys top management institutes.

Until recently, international investment banks were the flavor of the month and were hiring the best talent, said Bandyopadhyay of Reliance Money.

`Students also were running after the large names -- the Lehman Brothers, Bear Stearns of the world. This year, those institutions dont exist.`

Like all good gurus, teachers and academic staff are advising students not to panic and to knuckle down to some serious work with the hope the economy will change for the better by the time they get their degrees.

`Its the best time to study,` said Arvind Narasimhan, placement secretary at Delhis Faculty of Management Studies.