Things are looking up in India. Young New-Delhi natives can be seen hanging out with their $400 Ericsson feature-loaded mobile phones, watching the latest X-Men movies, and sipping cappuccinos with friends at hip coffee shops.

College graduates are landing well-paying jobs in a host of emerging industries that barely existed in India three years ago: retail chains, fast-food restaurants, mobile-phone companies and especially call centers, data-processing firms and other businesses that do "back office" work for U.S. companies.

The youngsters are part of a middle-class boom in India. The National Council of Applied Economic Research estimates that the number of people living in households that earn at least $1,800 annually-considered the minimum for middle-income families-has increased 17% in just the past three years, to more than 700 million. At this income level, Indian families can purchase motorbikes, televisions and refrigerators. The organization expects the number to rise an additional 24% by 2007.