With this stark warning, Gunjan Samtani, Chair of the CII Task Force on Global Capability Centers (GCCs) and Country Head of Goldman Sachs Services India, set the tone at the CII GCC Summit in Delhi on July 14, 2025.
The urgency was echoed by Finance Minister Nirmala Sitharaman in her 2025 budget speech, where she elevated GCCs from being seen merely as job creators to being recognized as strategic engines of innovation and economic resilience. Moreover, according to November 2024 report from consulting firm Inductus, engineering-focused GCCs grew 1.3 times faster than the general GCC growth rate, indicating a clear shift toward high-value activities.
Once known as captive centers, GCCs have matured into wholly owned offshore subsidiaries that bring together core business functions, technology services, and innovation initiatives. Unlike outsourced providers, they are deeply integrated with their parent organizations, ensuring stronger governance, alignment, and security. Today, GCCs stand at the forefront of digital transformation, advanced analytics, and enterprise-wide innovation, making them central to India’s economic growth story and its global leadership aspirations.
EVOLUTION FROM COST CENTERS TO INNOVATION HUBS
The GCC journey began in the 1990s as a cost-saving strategy, primarily handling back-office IT and support services. By 2025, GCCs firmly repositioned themselves as strategic partners in innovation, responsible for AI adoption, cybersecurity, cloud transformation, R&D, and customer experience enhancement.
- Role in Business Transformation: GCCs enable enterprises to modernize operations and scale innovation by embedding digital first practices, data-driven insights, and agile methodologies.
- Driving Operational Efficiencies: By centralizing processes, GCCs ensure cost efficiency, process standardization, and global scalability. The model supports 24×7 operations across geographies, enhancing customer and market responsiveness.
- Integration with Parent Strategy: Many multinationals now position their GCCs as core to enterprise strategy. Senior leadership roles are increasingly based in Indian centers, two levels below global CEOs, underscoring India’s pivotal role.
INDIA'S STRATEGIC POSITION IN THE WORLDWIDE GCC LANDSCAPE
Global and India Market Size
- Worldwide: There are ~3,200 GCCs globally.
- India: With nearly 1,700 GCCs, India represents 53% of the global total. This leadership is unmatched, driven by talent depth, cost advantages, and a maturing digital ecosystem.
The Indian GCC sector is projected to grow at a CAGR of 8% through FY28, crossing 2,100 GCCs by then. Collectively, GCCs already contribute over 1% to India’s GDP and are expected to generate USD 100+ billion annual revenue by 2030.
Employment and Talent
- India’s GCCs employ 1.5M+ professionals today, with forecasts of 1.9M jobs by end-2025.
- Mid-market GCCs (~800 in number) alone employ 220,000 professionals, showcasing the growing importance of mid-sized enterprises in the ecosystem.
- India’s digital talent pool (AI, cybersecurity, data science) remains its strongest differentiator
Sectoral Breakdown
- IT & IT-enabled Services (49%) remain the largest segment.
- BFSI (17%) is the second-largest vertical.
- Other fast-growing domains: healthcare, engineering, telecom, consulting, and media (~19%).
Notably, UK-headquartered GCCs represent 6–8% of India’s GCC market (130+ centers, 200k+ employees), focusing heavily on Engineering, AI, and Product Development. Japan and other APAC players are also increasing their presence, particularly in Hyderabad and Chennai.
City-Wise Distribution (2025)
- Bengaluru: 40% share of GCC leasing (IT/ITeS, BFSI, R&D; US/Europe/APAC HQs).
- Delhi NCR: 24% (BFSI, consulting, tech).
- Chennai: 14% (Tech, BFSI, manufacturing).
- Hyderabad: 10% (Tech, manufacturing).
- Mumbai: 6% (BFSI, consulting).
- Pune: 5% (IT, engineering).
THE FOUR PILLARS OF INDIA'S GCC SUCCESS STORY
Access to a Vast & Specialized Talent Pool
India’s GCC ecosystem employs around 1.5 million professionals today, with projections reaching 1.9 million by end-2025. Mid-market GCCs alone account for approximately 220,000 employees, underscoring the depth and diversity across organization sizes.India produces 2.5mn + STEM graduates each year, second only to China by volume, with 34% of all graduates in STEM. This robust talent pipeline helps enterprises rapidly build specialized teams in AI, cloud, data science, and cybersecurity, making GCCs robust engines for innovation.
Strong Economic Value & Scalability
- Economic Contribution: In FY2025, the direct output of India’s GCC sector stood at USD 76 billion, which marks a 6× increase since 2010 and signifies a robust 13% CAGR.
- Broad Economic Impact: Considering indirect and induced effects through job-driven consumption and supply chain activity, the total economic footprint reaches USD 241 billion.
- GDP Share: GCCs contribute around 2% of India’s GDP and 4% of its services sector GDP, underscoring their importance in the wider economy.
- Growth Outlook: The GCC sector is expected to grow at an impressive 8% CAGR through FY2028, with GCCs increasing from 1,700 to over 2,100 by then. Ecosystem-wide, revenue is projected to surpass USD 100 billion by 2030, supported by an 11–12% CAGR between FY2025–29.
Acceleration of Innovation & Strategic Capabilities
- AI and R&D Leadership: GCCs are rapidly embracing high-value functions 55% of sector revenues in 2023 stemmed from R&D and innovation activities.
- Emerging as Innovation Hubs: Global companies increasingly rely on India-based GCCs for strategic AI-driven roles, such as analytics, automation, predictive maintenance, risking a shift from cost-based leverage to “intellectual arbitrage”.
- Strategic Shift: Industry leaders emphasize that GCCs are no longer cost centers but “strategic value creators” integral to product innovation and enterprise-wide digital transformation
Enhanced Global Competitiveness and Agility
- Economic Growth Impact: GCCs are projected to add USD 0.5 trillion to India’s gross value added (GVA) in the decade ahead, integral to the country’s projected $10 trillion GDP milestone.
- 24×7 Global Operations: GCCs enable enterprises to operate across time zones with faster decision-making, localized customer insights, and operational responsiveness.
- Strategic Resilience: In the face of geopolitical shifts, regulatory uncertainty, and rising costs, GCCs help multinational companies maintain agility and strategic control, a trend that’s drawing increased global investment.
When setting up a Global Capability Center, enterprises must carefully weigh several key considerations. Foremost is the availability of talent pools across IT, BFSI, and emerging domains such as AI, data science, and cybersecurity, which ensures access to the right skills for long-term scalability.
Equally important are the regulatory and tax incentives offered at both national and state levels, as these directly impact cost structures and compliance ease. Organizations must also assess the maturity of infrastructure, spanning both physical facilities and digital ecosystems, to enable seamless operations. Finally, every decision should be closely tied to the enterprise’s broader transformation goals, ensuring that the GCC is not just a delivery unit but a strategic enabler of growth and innovation.
Clearly outline the functions the GCC will perform whether IT, finance, R&D, or multi-functional. Establish strategic objectives, such as cost efficiency, innovation, or supporting global operations, to guide the setup process.
CONDUCT A FEASIBILITY STUDY
Evaluate potential costs, risks, and ecosystem maturity of different locations. This includes assessing local talent availability, regulatory ease, infrastructure readiness, and long-term sustainability.
SELECT THE OPTIMAL LOCATION
Choose a city or region based on talent depth, operating costs, time zone compatibility, & cultur. In India, Tier I cities remain the primary base, but Tier II cities are emerging, backed by gov. policy support & industry readiness.
BUILD THE BUSINESS CASE
Develop a compelling case for investment by projecting ROI, identifying strategic advantages, and securing executive sponsorship. This ensures long-term buy-in from the parent company.
ENSURE REGULATORY COMPLIANCE
Align with national and state-level legal frameworks, tax incentives, labor laws, and data protection requirements. Proper compliance from the start prevents future operational or reputational risks.
INVEST IN INFRASTRUCTURE
Plan for both physical and digital infrastructure. This includes setting up modern office spaces, IT systems, cybersecurity measures, and connectivity to ensure secure, efficient operations.
TALENT ACQUISITION & BRANDING
Attract top talent through a strong employer brand, competitive compensation, and clear career growth pathways. Early investment in talent ensures rapid scaling and stability of operations.
GOVERNANCE & LEADERSHIP
Set up governance frameworks and appoint capable leadership to align the GCC’s operations with global strategy. Transparent reporting structures and accountability mechanisms are crucial for integration.
KPI MEASUREMENT SYSTEMS
Implement KPIs, dashboards, and regular review processes to track efficiency, productivity, and delivered value. Continuous monitoring ensures alignment with enterprise transformation goals.
Global Capability Centers are designed with a multi-layered organizational structure that balances functional delivery, innovation, and strategic governance. At the core are functional teams spanning IT, finance, HR, compliance, procurement, and analytics—responsible for day-to-day business operations and global service delivery. Complementing these are Centers of Excellence (CoEs), which act as innovation hubs focused on emerging areas such as AI, automation, data analytics, cybersecurity, and digital engineering.
Supporting these core units are critical support functions, including HR operations, facilities, legal, logistics, and procurement, ensuring smooth business continuity. Oversight is provided by strong leadership and governance frameworks, often blending global strategy with local execution, with senior leaders embedded in India to align GCC objectives with enterprise-wide goals.
Within this structure, GCCs execute key functional roles:
- Technology & Digital: Driving enterprise-wide transformation through AI, automation, cloud, and application development.
- Operations: Enhancing customer experience, streamlining supply chains, and managing procurement efficiently.
- Finance & Compliance: Delivering centralized accounting, risk management, anti-money laundering (AML) processes, and regulatory reporting.
- R&D and Innovation: Designing, testing, and engineering new products and services, strengthening the parent company’s innovation pipeline.
- Talent & HR: Building employer branding, developing leadership pipelines, and driving capability-building programs.
Together, this integrated structure enables GCCs to function as strategic engines of global enterprises balancing operational efficiency with innovation and enterprise transformation.
Legal and Regulatory Framework Expertise
- Entity Structuring & Tax Optimization: Your GCC partner should demonstrate expertise in designing optimal corporate structures that maximize tax efficiency while ensuring full regulatory compliance and smooth profit repatriation.
- Intellectual Property Strategy: Look for partners with proven track records in IP protection frameworks, especially when establishing Centers of Excellence handling sensitive product engineering and AI development.
- Regulatory Navigation: Choose partners who actively monitor and adapt to India’s evolving policy landscape, including SEZ/IFSC regulations and transfer pricing rules, ensuring your GCC remains compliant.
Compliance and Security Excellence
- Data Protection Mastery: Your partner should have robust frameworks for GDPR, India’s Digital Personal Data Protection Act (2023), and other global privacy regulations, with demonstrated experience in secure data management.
- Cybersecurity Leadership: Evaluate partners who invest in advanced threat detection, resilience frameworks, and regular compliance audits to protect your digital-first operations.
- Multi-Geography Compliance: Seek partners experienced in aligning with U.S., EU, and APAC compliance regimes simultaneously, reducing complexity through standardized processes
Strategic Risk Mitigation
- Location Strategy: Consider partners who can guide you beyond the 94% concentration in Tier I cities, offering strategic diversification into emerging Tier II locations to optimize costs and reduce infrastructure dependencies.
- Talent Retention Programs: Look for partners with proven methodologies for managing talent attrition, particularly in high-demand areas like AI and cybersecurity, through competitive retention strategies.
- Cost Management: Choose partners who proactively address wage inflation and real estate costs through strategic location planning and operational efficiency programs.
Operational Excellence and Cultural Integration
- Change Management Expertise: Your partner should demonstrate capabilities in seamlessly blending global corporate culture with local practices, ensuring smooth organizational integration.
- Governance Framework Design: Evaluate partners who can establish transparent reporting, accountability, and decision-making processes that work effectively across multiple time zones.
- Execution Track Record: Select partners with documented success in smooth transitions, including migration strategies and robust IT infrastructure investments that prevent operational disruptions.
A leading enterprise was facing challenges in its Invoice-to-Cash (I2C) process, a critical function for working capital management. Despite scale, the process was plagued by manual intervention, delayed cash conversion, limited visibility, and high-dispute resolution times. Leadership sought to reimagine the function as a digital-first, strategic enabler of growth rather than a transactional back-office activity.
CHALLENGE
The client’s I2C process suffered from:
- High Days Sales Outstanding (DSO), affecting liquidity.
- Limited visibility into receivables, cash flows, and customer payment behaviors.
- Manual workloads consuming 60–70% of Accounts Receivable (AR) team capacity.
- Inaccurate cash application, leading to reconciliation backlogs.
- Weak customer experience, as dispute resolution was slow and error prone.
The need was clear: an intelligent, end-to-end solution that would reduce friction, improve cash flow predictability, and empower AR teams to focus on strategy.
THE SOLUTION
We implemented a modular, API-driven I2C platform powered by Agentic AI, Machine Learning (ML), and Natural Language Processing (NLP). This enabled digitization, predictive insights, and intelligent automation across the entire I2C lifecycle.
- Intelligent Invoice Management: Automated invoice validation, classification, and digital delivery.
- Predictive Collections Engine: AI-driven customer risk scoring optimizes collection strategies.
- Machine Learning-Based Cash Application: Self-learning auto-matching of payments with 90%+ accuracy.
- Dispute & Deduction Resolution Automation: Faster case handling with AI-assisted triage and communication.
- Cash Flow Analytics & Dashboards: Real-time insights into receivables, trend analysis, and forecasting.
IMPACT AND BENEFITS
The transformation delivered measurable, high-impact results:
- 50% reduction in DSO freeing up significant working capital.
- 90% auto-matching accuracy in cash application, reducing reconciliation errors.
- 45% increase in AR team capacity, enabling staff to focus on value-added tasks.
- 40% cycle time reduction across collections and dispute resolution.
- Enhanced customer relationships through faster, error-free interactions.
- On-demand dashboards provided real-time credit reviews, payment performance monitoring, and year-over-year analytics.
Global Capability Centers have firmly established themselves as strategic engines of growth, with India at the helm—hosting 1,700+ centers, 1.5 million professionals, and a projected $100B in revenues. Their continued success will depend on clarity of purpose, strong talent and location strategies, sound governance, and an unwavering focus on innovation. As enterprises look beyond transactional delivery, GCCs are emerging as embedded extensions of global strategy, driving adoption of AI, data science, cybersecurity, and cloud. With supportive policy frameworks and infrastructure investments, India’s GCC story is poised for its next chapter—where these centers will not just support operations but define the future of enterprise transformation worldwide.
