What if nid reaches the maximum ? What if my nid reaches the maximum allowed value of MySql int type 

I have made a drupal.org site search that ends up Here. And also i found Integer Types (Exact Value). In an app that i am about to build is a contact manager for students. Which is supposed to pull gmail, fb contacts in future. My plan is to make each contact a node. Is it a good idea to keep each contact as separate node? Can you suggest any other brilliant mechanism to handle this? 

I am worried about the overflow of nid as i made a test run using may own gmail id, which ends up in a 1025 new nodes. 

I am using typical Drupal 7.14 installation.
If nid reaches the maximum your site will no longer be able to create new nodes as there will be SQL errors whenever Drupal tries to insert a new nid.

Chances are though, that drupal.org will hit this limit before you do, regardless of what you're doing to your site in any useful real-world application.

If drupal.org gets anywhere close to 4 billion nodes, there definitely will be a workaround readily available for you.