Human capital is a broad and multifaceted concept encompassing many different types of investment in people. However, the key aspect of human capital has to do with the knowledge and skills embodied in people. Human capital has always been an extremely important determinant of individual and social progress. In the present scenario, it is the central instrument for developing economies in an increasingly competitive, services-led, knowledge-driven global economy. The degree of responsiveness of the skilled human resources on the overall development and specifically the economic growth has been well established. Notwithstanding the known linkages between economic growth and human capital, it is pertinent to understand the significance of the skilled workforce in knowledge economy and hence in economic development. This study highlights the emerging trends in the global economy, which shows an increasing reliance on the knowledge-driven sectors for growth. It focuses on the emerging issues and challenges in the face of an ageing population in developed countries and the increasing trend of relocating services jobs through offshoring and their likely impact. It argues that the changing demographic profile of high-income nations and offshoring provide countries like India with an opportunity to increase their pace of economic development. It examines the higher education infrastructure in India and the quality and depth of skilled human resources coming out of this system so as to capitalize on this opportunity. It deliberates whether India can leverage its talent pool to build/sustain the competitive advantage or not, and whether it can maximize returns from the pace of the globalization process. (Contains 4 figures and 6 tables.)