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India's Global Capability Center
India's Global Capability Centres Market analysis
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India’s resilient economy and favorable business environment are fueling the expansion of Global Capability Centers (GCCs) even amid global economic challenges. GCCs are evolving into key hubs for innovation and digital transformation, significantly strengthening their role in the global value chain. Supported by government initiatives, India offers a vast talent pool in technology, engineering, and consulting, along with cost-effective office space, modernizing infrastructure, and improved connectivity between major cities and smaller urban centers. Combined with a thriving startup and R&D ecosystem and a strong financial regulatory framework, India is an attractive destination for multinational corporations to establish and grow their GCCs.
ID:-2024001 Geography: India Author: Pinal Patel
ID:- 2024001
Geography: India
Author: Pinal Patel
India's Global Capability Centers Market Projected to Hit $110 Billion by 2030
What Are Global Capability Centers (GCCs)?
Global Capability Centers (GCCs), formerly known as Global In-House Centers (GICs) or captives, are offshore centers established by multinational companies to deliver a range of specialized services to their parent organizations. These services often include IT support, research and development (R&D), customer service, and other key business functions. Operating as integral parts of a company’s global structure, GCCs enhance internal capabilities and drive operational efficiency.
GCCs are critical in helping organizations reduce costs, tap into global talent pools, and strengthen collaboration between parent companies and their offshore teams. These centers initially emerged in the early 1990s, pioneered by major corporations such as General Electric, Texas Instruments, Citigroup, and American Express, to manage their offshore operations more efficiently.
With the evolution of technology and business processes, GCCs have become essential hubs for innovation and digital transformation across industries.
Key Market Drivers
- Electric Vehicles (EVs) and Autonomous Cars: The rise in EV production and advancements in autonomous driving technology are boosting demand for advanced chips and semiconductors. Automakers are focusing on technologies like Advanced Driver Assistance Systems (ADAS), smart cockpits, and infotainment solutions, all of which require highly specialized semiconductor components.
- 5G and Fiber-Optic Networks: The shift from 4G LTE to 5G networks, particularly in developed nations, is creating a surge in demand for cutting-edge electrical parts and semiconductors. This transformation is expected to drive significant investments in semiconductor infrastructure globally.
- Artificial Intelligence (AI): AI is playing a pivotal role in semiconductor manufacturing by enhancing quality control processes and reducing product recalls. Semiconductor companies are increasingly integrating AI into their operations to optimize production efficiency and output.
Market size and growth drivers
In 2022, India accounted for 55% of the world’s operational Global Capability Centers (GCCs). By 2025, India is expected to see the establishment of approximately 320 new GCCs, as many companies look to set up their first global centers abroad.
The number of GCCs in India has now reached 1,800, employing 1.3 million people, and is projected to exceed 1,900 by 2025 and 2,400 by 2030. Depending on India’s capabilities, the number of GCCs could even reach 2,550. Currently, India is estimated to add 115 new GCCs annually, a substantial increase from the current rate of 70 per year. This rapid expansion positions India as a global leader in technology and services.
The growth of GCCs in India is primarily driven by engineering and R&D services, which contribute 56% of the total revenue. India’s skilled workforce, favorable business environment, and improving infrastructure are key factors fueling this growth.
Types of global capability centers
| Type of GCC centers | Feature |
|---|---|
| Shared service centers | Finance, HR, IT, and procurement, all at one place for efficiency. |
| R&D centers | Innovation hubs for new products, technologies, and processes. |
| Knowledge centers | To help organizations remotely share information. |
| Innovation centers | Companies ccn develop new ideas, conduct research, and build prototypes. |
| Customer service centers | For managing customer inquiries, complaints, and feedback. |
Currently, R&D services contribute 56% to the total revenue of Global Capability Centers (GCCs). In the coming years, a significant portion of GCC revenue is anticipated to come from Engineering R&D (ER&D) and digital engineering. These sectors are forecasted to grow at a compound annual growth rate (CAGR) of around 20%, signaling a strong upward trajectory in their contribution to overall GCC revenues.
Key players
Financial services
AMEX
Citibank
American Express
HSBC
Fidelity
consulting
McKinsey
KPMG
Deloitte
JPMorgan
Information technology
IBM
Dell
Accenture
HP
Internet
Google
Microsoft
Amazon
Retail
Tesco
Supervalu
Target
Information intermediaries
Nielsen
Dunnhumby
IRI
FICO