Karnataka to unveil dedicated policy for Global Capability Centers on Sept 27

(L-R) Karnataka IT-BT Minister Priyank Kharge, CM Siddaramaiah, and Karnataka IT Secretary Ekroop Caur

Karnataka will unveil a dedicated policy for Global Capability Centers (GCCs) on September 27 as the first Indian state to have such a system in place.

Officials from information technology and biotechnology department said the draft Karnataka GCC Policy (2024-29) will be launched in Bengaluru.

"Karnataka leads India's digital revolution, with Global Capability Centers (GCCs) as key growth drivers. Our state hosts innovative, diversified GCC hubs across vital industries, powered by skilled professionals and advanced tech infrastructure," said IT-BT Minister Priyank Kharge.

Also, read: Bengaluru solidifies GCC hub status with 875 units, NCR a distant second with 465

"To further strengthen our position, we are implementing strategic interventions to create a resilient ecosystem for GCCs. I am proud to announce that the Government of Karnataka will introduce India's first GCC policy, supporting new operations in our state," he said. "This initiative reinforces our commitment to fostering a vibrant business environment and cementing Karnataka's status as India's premier GCC destination."

The state has conducted stakeholder consultations with industry leaders and bodies such as the National Association of Software and Service Companies (Nasscom). "The upcoming GCC policy will foster a resilient ecosystem that will support GCCs in leveraging a skilled workforce and advanced infrastructure. It will further cement the state’s position as a premier GCC destination," IT-BT Secretary Ekroop Caur said.

"It will reiterate the government's commitment to strengthening the GCC ecosystem, giving further impetus to e-R&D, innovation, and talent availability."

Also, read: Chennai tops GCC headcount growth in FY24; Hyderabad, Bengaluru follow

Bengaluru is home to over 30 percent of GCCs in the country. The GCC policy is expected to prioritise Beyond Bengaluru clusters, including Mysuru, Mangaluru, Kalaburagi, and Tumakuru. Karnataka aims to capture over 55 percent of India's GCC market by 2030. The policy is also likely to include incentives for companies investing in Beyond Bengaluru clusters.

A Global Capability Center is an offshore unit set up by a company in a foreign country to in-source IT and other related business functions.

Also, read: Karnataka set to be the first state to come up with GCC policy by August

The Karnataka government has decided to partner with IT companies to provide training in emerging and advanced technologies to the youth. The government on September 9 launched the 'Nipuna Karnataka - Skill Local/Go Global' programme, designed to equip recent graduates from both urban and rural areas with advanced industry-relevant skills in emerging technologies.

Also, read: Nipuna Karnataka: State to partner with tech companies to train youth in emerging technology

Karnataka is facing tough competition from Tamil Nadu, which has announced plans to incentivise the creation of high-paying jobs in new GCCs. Tamil Nadu Finance Minister Thangam Thennarasu, in his state budget for 2024-25 tabled on February 19, stated that the state plans to attract GCCs by offering a payroll subsidy of 30 percent in the first year, 20 percent in the second year, and 10 percent in the third year for jobs paying above Rs 1 lakh a month.

Also, read: Karnataka, Tamil Nadu woo GCCs with incentives in state budgets