India has 1,700 GCCs employing 1.9 mn professionals: Can they move services up the value chain?

India’s global capability centres (GCCs) are increasingly evolving beyond traditional back-office and cost-arbitrage functions, with the potential to become strategic hubs for innovation and high-value professional services. NITI Aayog, in its third Services Thematic Series report, India’s Services Sector: Insights on Regulatory Regime in Professional Services, has highlighted the role of GCCs in helping India move higher up the global services value chain.

GCCs emerging as strategic innovation hubs

The report notes that India has around 1,700 GCCs employing more than 1.9 million professionals. These centres are increasingly serving as strategic innovation hubs, with global companies localising advanced functions in India, including artificial intelligence and machine learning, intellectual property strategy and complex financial modelling.

This represents a shift from the traditional model in which India’s services advantage was largely built around lower-cost delivery and execution.

NITI Aayog said India’s combination of cost arbitrage and a large skilled talent pool provides a strong foundation for deeper integration into global value chains. However, targeted policy action could help unlock greater value from this existing advantage.

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From cost-based delivery to high-value services

The report argues that India needs to transition from cost-based delivery towards high-value, knowledge-intensive activities. These include research and development, strategic technology operations, engineering design and consulting.

Such a transition could also change the nature of work being undertaken by Indian professional services firms.

In legal services, for instance, the report points to an evolution from process-driven outsourcing towards analytical projects. In engineering, the opportunity lies in moving towards design and development, while management consulting could shift from data processing towards scenario modelling.

The broader objective is to enable Indian professionals and services companies to participate more meaningfully across global value chains rather than primarily providing execution support.

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AI could accelerate the shift

Technology is expected to play an important role in this transformation. NITI Aayog said advances in AI, machine learning and automation are reshaping professional services by automating routine activities such as data processing while increasing demand for advanced analytics and strategic advisory services.

The report identifies opportunities for India to move beyond back-end execution towards AI-enabled decision-making, including proprietary tools for financial modelling, legal analytics and consulting.

At the same time, the report flags the need for accessible reskilling and upskilling, as technological change is expected to both displace and create jobs.

New opportunities beyond technology

The report also identifies sustainability and geopolitical changes as potential growth areas for Indian professional services.

The global push towards net-zero commitments is creating demand for ESG audits, carbon accounting, climate-risk assessment, sustainable finance and renewable-energy advisory. Geopolitical uncertainty and trade fragmentation are also creating opportunities in supply-chain restructuring, risk management and regulatory compliance.

For India, the challenge will therefore be to convert its large GCC and skilled-professional base into a platform for AI-enabled, sustainability-oriented and globally integrated knowledge services.

The report's broader strategy calls for continuous professional development, transparent regulatory practices, elevation of professional services within the value chain and greater adoption of emerging trends.

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