Will the GCC boom transform India's job market?

India has an unemployment problem. Its gross domestic product (GDP) growth numbers often mask issues such as quality of employment due to skill shortages. The growth and large-scale expansion of global capability centres (GCCs) in India could be the answer for job seekers.

The beginning of the Indian GCC story can be traced back to the mid-1990s when multinational companies (MNCs) started setting up back offices in India. Few could have predicted the scale and significance they would attain in the next few decades. These have evolved into GCCs that are not just offshore support units for global businesses but doing high-value work for their global parents. The trickle that started in the 1990s has become a wave and made India the GCC capital of the world hosting more than 45-50% of all GCCs, according to EY India.

GCCs in India are driving innovation, shaping products, leading digital transformation and playing a key role in the growth of the economy and India Inc. The country is home to more than 1,800 GCCs, employing 2.1 million professionals, as per a report by Talent 500, a platform that connects talent with opportunities at GCCs. The report said that they have started contributing to the India growth story, as these centres contribute more than 1.5% to India’s GDP, with their share expected to grow further in the coming years.

The outlook for the growth of GCCs looks strong considering India’s demographic dividend, government policies and a large and skilled talent pool. While demographic dividend could be an advantage, the lack of skilling could be the biggest challenge for GCCs, which have emerged as a strategic powerhouse for global business operations.

INDIA FOR THE WORLD

A GCC, also known as a global in-house centre, is an offshore or nearshore entity fully owned and operated by a parent company. These provide specialised services such as information technology, research and development, and carry out complex back-office functions. They leverage global talent, cost arbitrage, and operational efficiencies. While meeting with Swiss industry leaders in Switzerland’s Bern, Union Commerce, and Industry Minister Piyush Goyal recently said that with close to 2,000 units, India is the preferred centre for GCCs. Skilled Indians serve the research, innovation and design needs of the world. “Capgemini alone has 2,50,000 people in India. Deloitte, EY and PwC have hundreds of thousands of employees. People who meet me have plans to double their manpower in three-four years. I have yet to meet someone who doesn’t have plans to double their workforce in India within the next five years. That is a scorching pace of development,” Goyal said.

Novo Nordisk Global Business Services (GBS), which currently has 4,500 employees across 17 business functions and represents the entire pharmaceutical value chain, is aiming to expand with an additional 200-300 new positions in 2025.

“India also has a vast, highly skilled workforce with deep domain expertise across core functions such as product supply, quality audits and research, making it a preferred destination for our GCC. With one lakh medical doctors and more than two million STEM graduates leaving Indian universities every year, the scale of the skilled talent is unparalleled globally,” says John Dawber, Corporate Vice President and Managing Director, Novo Nordisk GBS.

Post-Covid, many MNCs are adopting a China+1 strategy to reduce the risk of overdependence on any one region. India has emerged as the top beneficiary. Companies from sectors like technology, banking, financial services, and insurance (BFSI), and manufacturing are diversifying into India to insulate against risks in Europe, China or Eastern Europe.

“GCCs offer a concrete buffer against economic instability and geopolitical risks, enabling companies to maintain operational continuity and access vital resources even amidst severe domestic challenges. More than just cost centres, the country’s GCCs are evolving into strategic hubs that are not only redefining the Indian corporate landscape but also influencing global business dynamics,” says Srikanth Srinivasan, Vice President, and Head, Membership, and Outreach, Nasscom.

Just one look at the data on office leasing is enough to see the pace at which the GCCs are expanding. As per ANAROCK Research’s data on Indian office markets, the top seven cities witnessed gross leasing of over 141.43 million square feet (mn sq ft) in 2023 and 2024. Of this, GCCs alone leased 52.88 mn sq ft, around 37% of the total.

Bengaluru remained on top with GCCs leasing around 24 mn sq ft of gross office space (46% share). Hyderabad was a distant second with GCCs leasing over 10.06 mn sq ft, accounting for nearly 19% of the total space leased by these centres in the top seven cities. In Chennai, GCCs leased about 5.29 mn sq ft. Of this, around two mn sq ft was leased in 2023 while nearly 3.29 mn sq ft was leased in 2024, a 64% annual rise.

Likewise, GCCs leased about 5.28 mn sq ft. in Pune. Of this, 2.1 mn sq ft was leased in 2023 while nearly 3.18 mn sq ft was leased in 2024, a 52% annual rise.

Peush Jain, MD-Commercial Leasing and Advisory, ANAROCK Group, in an earlier note said, “Union Budget 2025-26 further strengthened the government’s commitment to attracting GCCs in India by announcing the introduction of a national guidance framework to help states attract and promote GCCs, strengthening India’s position as a global business hub. Given India’s rising economic influence, this move is expected to fuel office space demand beyond the major metros to Tier II and Tier III cities as well.”

ANSWER TO UNEMPLOYMENT?

The growth of GCCs in India is expected to have a transformative impact on India’s job market. Industry estimates suggest that GCCs could create more than two million additional jobs in India over the next five years across diverse roles, including data science, cybersecurity, design thinking, AI/ML (artificial engineering/machine learning) engineering, and finance, among others.

This becomes crucial at a time when India’s labour force is undergoing a critical shift. Automation and AI are reshaping industries, and new graduates are struggling to keep up. Mercer-Mettl’s India Graduate Skill Index 2025 report found that just 42.6% of graduates were employable, down from 44.3% in 2023.

Underlying all this is a growing imbalance between graduate capability and business demand. Technical skills in areas like AI and data science are highly sought after, but many graduates also lack the key soft skills such as communication, problem-solving and creativity. This imbalance is making job opportunities more elusive for the new entrants.

The rapid expansion of GCCs in India offers a potential solution by creating high-skill job opportunities and incentivising targeted upskilling aligned with industry needs. “While AI offers significant growth opportunities, it also brings the risk of job displacement. To mitigate this, rapid and continuous reskilling will be essential to shift talent from repetitive tasks to more cognitive and strategic roles,” says Milind Shah, Managing Director-India, Randstad Digital.

The skill index report further found that graduates from Tier I colleges have the highest employability at 48.4%, followed by Tier II (46.1%) and Tier III (43.4%) institutions. That, along with cost advantages, is perhaps why GCCs are focusing on Tier II and Tier III cities. This makes GCCs an important lever not just for white-collar employment but also for inclusive and geographically balanced economic development.

BEYOND THE METROs

New cities, beyond the traditional metro centres such as Bengaluru and Hyderabad, are emerging as GCC talent hubs. Shah of Randstad Digital says Coimbatore, Pune, Jaipur, Indore, Surat, Lucknow, Visakhapatnam, Chandigarh, Nagpur, Ahmedabad, Madurai, Kochi and Bhubaneswar are attracting GCC investments due to availability of high-quality engineering talent, lower real estate and living costs and enhanced connectivity and digital infrastructure.

“As global firms seek to de-risk from over-concentration in primary cities, these emerging hubs are poised to play a critical role in decentralising innovation and driving the next phase of India’s digital growth story,” he adds.

Some of the companies that have of late opened their GCCs beyond Tier 1 cities include Cognizant and Infinx Healthcare. The former inaugurated a 60,000 sq ft TechFin centre at GIFT City, Gandhinagar, in May this year. The facility focuses on digital engineering, AI, cybersecurity and analytics, with plans to expand its workforce to 2,000 over the next three years. Last year, Infinx Healthcare opened a delivery centre in Madurai to support US-based clients. The facility aims to create 700 jobs over the next five years.

The India GCC Landscape report by tech industry body Nasscom in collaboration with management consulting firm Zinnov highlighted that Tier II and Tier III cities housed about 7% of the total GCCs in FY24, up from 5% in FY19.

Experts say in the post-Covid world, with the right digital infrastructure and reliable power supply, Tier II and Tier III cities can become viable hubs for business operations. “We’re already seeing this shift. As connectivity and infrastructure improve, the smaller cities are increasingly poised to attract GCCs. This trend will gain momentum in the years ahead, enabling broader geographic diversification and tapping into talent pools beyond the metros,” says Pankaj Vyas, CEO and Managing Director, of Siemens Technology and Services.

FROM BACK OFFICE TO BOARDROOM

GCCs in India have evolved from providing basic data entry and IT support into hubs driving global decision-making for boardrooms across sectors. “The ecosystem is rapidly maturing as over 53% of GCCs have evolved into portfolio and transformation hubs. Leadership density is on the rise, with more than 6,500 global roles now based in India. These include more than 1,100 women in senior global positions,” says Srinivasan.

With an annualised growth rate of more than 10% over the past six years, GCCs’ market size in India stood at $72 billion at the beginning of 2025, compared to $40.4 billion in FY19. The market size of GCCs is projected to reach $110 billion by 2030 with more than 2,400 GCCs in the country, as per Talent 500.

“We have shifted from a traditional “say-do” model—where the headquarters dictated and we executed—to a model where we define our deliverables and follow through. That shift from cost to value, and from volume to value-driven growth, marks a significant transformation in the role and contribution of India’s GCCs,” says Vyas.

Srinivasan says India has become a microcosm of global organisations. Every business unit has some representation in India, making India’s GCCs the nerve centres of global tech advancement. Backed by a talent pool that is skilled in technology, expanding presence in Tier II/III cities and strong policy support, GCCs are driving end-to-end product ownership, AI-led transformation and global leadership roles.

POLICY SUPPORT

The growth has been supported by a conducive policy regime. The Indian government permits 100% foreign direct investment (FDI) in GCCs across key sectors such as IT, BFSI and healthcare, enabling a seamless investment landscape.

In 2024, IT and semiconductors-related GCCs attracted at least $2.2 billion in investments, driven by MNCs like Lam Research ($1.2B) and NXP ($1B). BFSI, aerospace, and pharmaceutical and healthcare sectors attracted $1.5 billion, $1 billion and $437 million, respectively.

Tech giants such as Microsoft and Cisco are also driving the evolution in India. Microsoft has expanded its presence in India, focusing on cloud computing, AI development and cybersecurity research.

“Microsoft India Development Center (IDC), over the past 26 years, has taken pride in being a leading innovation hub in India. Our journey, which started from one centre in Hyderabad, has now expanded to other cities like Bengaluru, Pune and Noida, where our teams have consistently stood out for their customer centricity, scale and innovation velocity,” says Rajiv Kumar, Managing Director and President, Microsoft IDC.

During his visit to India this year, Microsoft CEO Satya Nadella announced a record $3 billion investment in India to expand Azure Cloud, AI infrastructure and skilling initiatives, solidifying the company’s digital leadership. On the other hand, Cisco’s Bangalore GCC is its largest development centre outside the US and houses over 15,000 employees working on AI-driven networking, cybersecurity and 5G infrastructure.

According to Inductus GCC, a remarkable 124 top-tier global enterprises entered into agreements to establish GCCs between 2023 and 2024, securing prime office spaces for the development of advanced greenfield operations and research and development hubs. One of the companies on the list is BlackRock Inc., one of the largest asset management companies in the world. It is expanding in India with 1,200 new hires at its Mumbai and Gurugram hubs focusing on AI-driven investment research, risk management and financial analytics.

Carl Zeiss, a German optics and optoelectronics company, has also opened a GCC in Bengaluru to enhance its digital transformation and research initiatives. The unit will focus on cloud computing, cyber security and network operations while advancing software solutions for Carl Zeiss Meditec AG’s medical technology division. French multinational pharmaceutical and healthcare firm Sanofi is also expanding its GCC in Hyderabad with a €400-million investment over six years, including €100 million by 2025. The hub will grow to 2,600 employees, making it the largest of Sanofi’s four global centres.

Dawber of Novo Nordisk says the “employees come from both pharma and non-pharma backgrounds, including doctors, pharmacists, PhDs, statisticians, commercial experts, marketers, analysts, finance professionals, IT engineers and architects.”

What makes India a preferred destination for GCCs? Around 70% of the top 500 companies by revenue are expected to expand presence in India by 2030, as per the Nasscom-Zinnov report. Nishith Desai Associates, in its latest report on GCCs, says the reasons global companies prefer India for GCCs are economic resilience, political stability, government initiatives, and cost-effective infrastructure and workforce. “The country’s consistent economic growth, despite the global challenges posed by the Covid-19 pandemic, has enhanced India’s reputation as a reliable and stable business hub. The Indian government’s incentives are aimed at increasing the ease of doing business, upskilling the young demographic and easing taxation policies, creating a favourable environment for GCCs,” says the global legal and tax counselling firm. It adds the country offers affordable and reliable internet and communication services, ensuring seamless operations at a fraction of the cost in other countries. In Mumbai and Bengaluru, per employee costs are $33,570 and $33,083 per annum, respectively. The same is $134,400 per annum in USA and $63,416 in Manila, as per a Cushman & Wakefield report published in 2024.

GROWTH DRIVERS

Experts say regulatory reforms have also enhanced India’s competitiveness, fostering a business-friendly environment that continues to draw foreign investment. Building on this momentum, the Union Budget 2025-26 introduced a strategic framework to promote GCC expansion in Tier II cities. This includes building talent pipeline, developing world-class infrastructure and simplifying approvals through regulatory easing in key states.

India produces over 2.5 million STEM (Science, Technology, Engineering, and Mathematics) graduates annually, creating a strong and continuous pipeline of engineers, IT specialists and AI professionals who are ready to meet the evolving business needs.

In addition to this, with over 5.8 million tech professionals, India hosts the world’s second-largest IT talent pool. This workforce has deep expertise in software development, cybersecurity, AI and other emerging technologies, cementing India’s position as a global leader in digital transformation. Several states—including Karnataka, Telangana, Andhra Pradesh, Tamil Nadu, Gujarat, and Madhya Pradesh—have introduced GCC-focused policies that offer incentives and infrastructure support to attract and scale up GCC operations, as per Talent 500. Dawber of Novo Nordisk GBS says India’s supportive policy framework makes it a resilient and future-ready location.

Still, there is potential to do a lot more. “As a country, we must focus on streamlining entry pathways, enabling cost-effective GCC-as-a-service models, building vibrant innovation clusters and driving favourable policies,” says Srinivasan. Randstad Digital’s Shah says while India’s improving ease of doing business and digital public infrastructure provide an edge, further reforms, including skilling and reskilling at scale by integrating advanced AI, quantum computing, cybersecurity and cloud-native curriculum to align with evolving GCC roles, can unlock greater value. “Another initiative could be boosting collaboration between universities and GCCs for research, innovation and co-development of curriculum. This will help prepare a future-ready workforce aligned with GCC needs. Also, Tier II and Tier III cities need world-class digital as well as physical infrastructure to attract GCC investments,” says Shah.

BEYOND TECH

The GCCs operating in India are diversifying beyond traditional sectors such as IT and software. Companies from pharmaceutical, manufacturing and AI are also setting up GCCs to drive digital transformation. Industry experts say the BFSI sector has historically played a pivotal role with large as well as small financial services companies from the US and Europe expanding in India. Experts say the trend will continue with a second wave of BFSI companies emerging from the Middle East, Japan and the broader Asia region.

According to Talent 500, over 100 BFSI enterprises run more than 200 GCCs in the country. Most have multiple centres and collectively employ over 3,80,000 professionals, accounting for 20–25% of the total GCC workforce. Bengaluru leads in the number of BFSI GCCs, housing nearly 30% of them, followed by Hyderabad, Mumbai and Delhi-NCR.

“For fintech players, India is not just a development hub—it’s a strategic location to build, test and scale up global products. Sectors such as BFSI, healthcare, consumer tech, telecom and manufacturing will witness highest levels of GCC-led innovation over the next two decades due to their reliance on data and the need for resilient, scalable technology infrastructure. The shift from operations to innovation is already under way and will accelerate,” says Gurjodhpal Singh, CEO, Tide (India), a fintech player.

The healthcare sector has also witnessed growth in recent years, with healthcare-related companies establishing their presence in India. This trend aligns with the evolving landscape and the heightened importance of healthcare services after a global pandemic.

Data available with Talent 500 further revealed that 15% of all GCC employees in India work in the healthcare and life sciences sector. At present, there are over 95 GCCs in the sector in India, employing more than 3,00,000 people. In addition, India is home to the GCCs of more than 70 global retail or consumer packaged goods companies employing over 85,000 professionals. The report says that the sector is one of the fastest growing GCC segments in India, with BestBuy, 7-Eleven, Giant Eagle, Lululemon, Neiman Marcus, TJX, Hy-Vee, Northern Tool + Equipment, Inspire Brands, Kraft Heinz, and Adidas opening their centres between 2020-2024.

Travel and transportation is another sector where the presence of GCCs is growing. Companies like American Airlines, FedEx, UPS, Delta and Avis Budget Group, among others, have opened centres between 2019 and 2024. “Over 55% of the travel and transportation GCCs have been set up in the last seven years, driven by the success of incumbents, mature operating models and accelerated speed-to-value,” the Talent 500 report said, adding India is home to more than 35 travel and transportation-related GCCs, employing over 45,000 professionals.

Andrea Zimmerman, SVP and President, of Target in India says, “The mix of retail, technology and talent in India has gigantic potential to shape global retailing and commerce. GCCs also have the opportunity to further enable a consistent and seamless guest (consumer) experience that is powered by technology across all channels, particularly with the emergence of the phygital guest.”

KEY CHALLENGES

Despite a vast talent pool, the high demand for skilled professionals leads to increased attrition rates. Enterprises would have to invest in strong retention strategies, employee engagement programs and career growth opportunities. A recent CIEL HR study highlights rising talent pressures.

With 52% of GCC professionals actively job-hunting and 51% of organisations citing talent retention as their top challenge in 2025, the sector is facing high attrition, evolving employee expectations and intense competition for niche digital skills.

In addition to this, as GCCs scale up in ambition and complexity, new risks are beginning to emerge.

Global regulatory challenges are one of the few growing threats. Evolving data protection laws, digital sovereignty requirements and cross-border compliance complexities could limit the services that GCCs can deliver from India. Geopolitical shifts and rewiring of digital supply chains will further demand operational agility, especially as nations adopt more protectionist policies or restructure digital infrastructure.

An EY survey conducted last year found that among the key tax and regulatory concerns for GCCs, transfer pricing was a notable challenge. When asked about their expectations for supporting growth and expansion, 75% of GCCs highlighted the need for simplified compliance processes, 65% sought tax benefits and incentives and 60% emphasised the importance of enhanced infrastructure. Talent development programmes and stronger data privacy and security regulations were also seen as important priorities.

The survey also found that the risk of confidential information leaks due to increasing cyber-attacks and data breaches is a top concern for GCCs. With prolonged hybrid and remote work expanding the attack surface, security intelligence and monitoring are a priority for 73% of GCCs. Additionally, 82% of GCCs believe it is crucial to enhance cybersecurity awareness among employees while implementing robust cybersecurity policies and procedures.

GCCs are transforming from cost-effective back offices to innovation hubs, but to sustain this pace to its full potential, India will need to close its widening skills gap, especially among fresh graduates. Aligning academic courses with industry needs and investing in lifelong learning will be the key to inclusive and future-proof growth.