India is now home to over half of the world’s Global Capability Centres (GCCs)
According to a recent report by Vestian Research, more than 53% of global GCCs are based in India. That means out of around 3,200 centers worldwide, India hosts over 1,700.
Companies from technology, banking, life sciences, and other sectors are choosing India because of its skilled workforce. Major cities like Bengaluru, Hyderabad, Pune, and Chennai are top choices, while smaller cities such as Kochi, Coimbatore, and Ahmedabad are emerging as secondary hubs.
Setting up a GCC in India is not easy
Rohan Lobo, a partner at Deloitte India, explains that starting a GCC involves many steps and careful attention to legal rules. Firms in industries like banking, healthcare, and IT must deal with issues like setting up a business entity, getting approvals, complying with labor laws, and protecting data and intellectual property.
No national GCC policy yet, but new rules are being drafted
Although India doesn’t yet have a specific national policy for GCCs, the Ministry of Electronics and IT (MeitY) is working on one. This upcoming policy aims to offer incentives for GCCs, especially in areas like AI, healthcare, and financial intelligence.
Current support through SEZs, FDI policy, and STPI
- Special Economic Zones (SEZs) offer tax benefits and simplified clearances for GCCs located within them.
- Integrated GST (IGST) rules allow tax-free exports or refunds for services sent to SEZs.
- Foreign Direct Investment (FDI) rules permit up to 100% automatic investment in IT, research, and outsourcing sectors.
- The Software Technology Parks of India (STPI) scheme also supports GCCs, especially in IT.
State-level policies boost GCC growth
- Karnataka (2024–2029) aims to set up 1,000 new GCCs with $50 billion in output. It offers perks like up to 40% funding for capital costs, 3-year property tax refunds, and patent filing reimbursements.
- Hyderabad hosts over 273 GCCs with 300,000+ employees and offers a single-window clearance system.
- Gujarat (2025–2030) provides job-based incentives and reimburses electricity duties. GIFT City offers a 10-year tax holiday under Section 80LA and a lower minimum alternate tax rate.
Setting up routes: DIY, BOT, or joint ventures
Companies can go solo (DIY), hire vendors to build and transfer (BOT), or use hybrid/joint-venture models. Greenfield projects start fresh, while brownfield setups take over existing centers—each has its own benefits and challenges.
Compliance with data laws is crucial
- IT Act (Section 43A) holds companies accountable for protecting sensitive personal data.
- Digital Personal Data Protection Act (DPDPA 2023) defines roles for data collectors and processors, requiring consent, purpose limitation, and breach notifications. GCCs operating in India must follow these rules carefully.
- CERT-In regulations require reporting cyber incidents, keeping system logs for 180 days, and retaining cloud/data center records for five years.
- Data localization rules mean some sensitive data may need to stay in India, and GCCs must manage cross-border data transfers properly.
The road ahead
State GCC policies can ease setup and compliance, but smaller cities still need better infrastructure and talent. While India drafts a national policy targeting tech and AI, GCCs are already adapting by implementing privacy-by-design strategies, strengthening breach alerts, and aligning with global data protection standards.
