Ms. Gayathri Kamath, Senior Associate & Ms. Rachita Bhat, Partner at Trilegal

The India GCC Story: Where talent meets innovation

India’s rise to becoming the global capital for Global Capability Centres (GCCs), now hosting over 50% of the world’s GCCs is a testament to the India growth story.[1] In the last five years, the country has witnessed the establishment of around 1,100 additional GCC units, drawing multinational corporations (MNCs) across jurisdictions eager to tap into India’s dynamic GCC ecosystem.[2] While historically, the prowess of the Indian talent pool has been tested and established globally, such growth is also fuelled by India’s deep commitment to both, digital and other infrastructure and increased focus on innovation in a booming start-up/tech ecosystem.  

India has steadily shed its traditional role of being a low-cost outsourcing hub to a front-ended innovation hub thereby cementing India’s position as the frontrunner in the GCC landscape.

While historically companies based and incorporated in the United States of America dominated the Indian GCC market, India is now witnessing increased participation from other MNCs, particularly European MNCs. While Eastern European countries have long served as support hubs for European conglomerates, in recent years, there has been a shift in the trend with European MNCs looking to India to establish their GCCs. Amongst the European countries, MNCs based in France, including CapGemini and Sanofi have significantly contributed to such shift, with a focus on engineering, research and development. [3]

Regardless of the domicile, setting up and operationalising a GCC in India requires a comprehensive assessment of the regulatory landscape. From a structuring perspective, most multinationals either leverage their existing Indian subsidiary or establish a wholly owned subsidiary in India to set up their GCC. Depending on the business objectives, risk appetite, and timelines for expansion, one of the following models are typically adopted to operationalise the GCC:

(i) Self-Built/DIY Model: Under this option, the foreign entity directly establishes and undertakes the functions of setting up and operationalising the GCC, with minimal reliance on third-party vendors.

While this model provides significant control over processes, workflows, and data security, it involves higher costs, requiring significant investment in infrastructure and technology.

(ii) Build Operate Transfer (BOT) Model: Under this model, companies may engage specialized service providers to design, build, and operate their GCC in India, with the objective of eventually transferring ownership of the assets and operations to the Indian subsidiary.

While this model enables a reasonably speedy market entry by leveraging the service provider's expertise, transitioning ownership can involve complexities.

(iii) Hybrid Model: This model combines both DIY and BOT models and often involves arrangements where a service provider acts as the employer and manages HR functions, while the foreign entity oversees day-to-day operations.

Depending on the operational model adopted, certain model-specific issues are commonly addressed upfront. For instance, in a hybrid model, where the GCC employees may be on the service provider’s payroll, robust intellectual property assignment provisions must be in place to ensure that all work developed by such individuals is assigned to the GCC entity.

State-level incentives, infrastructure, and talent availability continue to be the key drivers influencing the choice of location in India. Cities like Bengaluru, Hyderabad and Pune are currently preferred for setting up GCCs in India, owing to accessibility of highly skilled talent, particularly mid and senior level resources. Certain states such as Andhra Pradesh, Gujarat, Karnataka, and Uttar Pradesh have introduced dedicated policies and incentive schemes to attract GCC investments. Additionally, companies may also consider establishing GCCs in specific delineated areas regulated by specialised regimes, such as Special Economic Zones or GIFT City, both of which offer favorable tax benefits and flexible repatriation structures. However, this requires navigating complex regulations and policies, including obtaining an approval prior to setting up.

With projected GCC revenues set to exceed USD 121 billion by 2030 (roughly 3.5% of India’s GDP) [4], India isn’t just enabling global capability, it has become a strategic anchor. The commercial rationale for such shift towards India has been met and complemented by robust government initiatives. In the recent Union Budget (2025), a national framework for GCCs has been announced with the aim to grow GCC capabilities in tier-II and tier-III cities as well.