Global Capability Centres (GCCs) are powering the next wave of software job creation, outpacing the traditional information technology (IT) sector in 2024, which has struggled to maintain its momentum. India, now hailed as the GCC capital of the world, has added over three lakh employees and nearly $20 billion in export revenue in 2024.
In stark contrast, IT companies have added less than a lakh in headcount and just $6 billion in market size during the same period. The stark decrease in numbers comes at a time when the IT industry is facing demand pressure triggered by a macroeconomic slowdown in the key markets of North America and Europe.
Top IT companies generate 50-65 percent of their revenue from these markets. Although the slowdown appears to be fading now, there’s a wider debate on how the future will evolve for both industries.
"India today has solidified its position as the 'GCC Hotspot of the World.' Government policies and investments in talent development have also fueled this growth, which continues at a sustained pace," management consulting Zinnov's president Nilesh Thakker told Moneycontrol.
Thakker added that while service providers have been cautious due to economic conditions, they’re adapting their models to support this GCC-driven ecosystem.
A GCC is a dedicated offshore unit established by a company in a foreign country to in-source IT and related business functions.
GCCs, also called captives, have been the buzzword set for exponential growth in the coming years. This can also be understood from the fact that India had over 1,700 GCCs and an export revenue of $65 billion in FY24, growing at over 40 percent from the previous year.
Moreover, India's Economic Survey 2024 showed that GCCs will contribute roughly 3.5 percent to India’s GDP by 2030, generating an estimated revenue of $121 billion by then
“One of the significant highlights of GCCs this year is the recognition as a formidable industry segment along with the huge contribution to GDP growth and job creation,” said Sameer Dhanrajani, CEO of AI advisory and consulting firm AIQRATE.
In the short term, GCCs are expected to create around 3.5 lakh new jobs in 2025, according to AIQRATE.
One of the largest employers in the GCC space, German technology conglomerate Siemens believes 2024 has been a transformative year for the captives, marked by economic, geopolitical, and technological shifts. “The adoption of hybrid work models and Generative AI (Gen AI) has redefined product development and enhanced innovation, enabling businesses to focus on delivering value-driven outcomes,” Siemens Technology Services' CEO and MD Pankaj Vyas told Moneycontrol.
GCCs in India are also driving decision-making for global firms and are no longer just back offices. Interestingly, data reveals that Indians constitute approximately 10-13 percent of leadership roles in GCCs.
Currently, about 100 Indian Chief Investment Officers/Senior Vice Presidents are employed in GCCs with salaries falling in the million-dollar club, Moneycontrol reported in July citing data from ANSR Research and TeamLease Digital.
Also read: Indians occupy 10-13% leadership positions in GCCs
Hype to Adoption: Gen AI
In 2024, Gen AI become mainstream within the GCC space in India, with advancements in cloud computing, edge computing, predictive AI, and more.
In 2024, Dell Technologies says the sector integrated AI, automation, and new-age digital technologies. Consequently, this push has not only led to better operational efficiencies but has also catapulted GCCs' into expansion mode. “Their expansion into high-growth sectors like sustainability and fintech further strengthened their global position,” said Kavita Mehra, General Manager of Dell Technologies’ India Center of Excellence.
This is because 2024 was the year when the number of GenAI/AI proof-of-concepts (PoC) implementations was on the rise. Various entities reporting between 20-50% PoCs advancing to production and generating business value.
Also read: Over 50% of AI proofs-of-concept in production, driving business value: Wipro Cloud chief
GCCs are also investing heavily in Gen AI, with dedicated teams focused on AI, machine learning (ML), and data analytics. The emphasis is moving from routine tasks to high-value strategic roles.
“Moving away from being cost-efficient, the focus has shifted towards driving revenue through innovation in customer experience, core R&D, and transformational business models,” said Biju Davis, vice president of engineering at revenue optimisation and compliance platform Model N.
These insights paint a clear picture: 2024 is the year when GCCs fully embraced the potential of Gen AI.
2025 Outlook
As the industry steps into 2025, experts believe the momentum has been established. GCCs will continue to solidify their role in innovation and digital transformation in the coming year.
Nonetheless, for GCCs to remain competitive, the key will lie in maintaining a balance between driving innovation and managing talent effectively. “The success of 2025 will hinge on how well GCCs balance digital transformation with effective talent management, ensuring they maintain a competitive edge in a fast-changing business landscape,” Mehra said.
Meanwhile, 2025 will also be a year when more state governments will roll out GCC-friendly policies for growth and employment opportunities.
Karnataka is the first state in the country to come up with a dedicated GCC policy to attract higher investments in the sector. West Bengal has also announced a GCC policy.
Karnataka is also facing tough competition from Tamil Nadu, which has announced plans to incentivise the creation of high-paying jobs in new GCCs.
Also read: Karnataka, Tamil Nadu woo GCCs with incentives in state budgets
“2025 will be the year of great emergence for GCCS with state governments creating GCC-friendly policies along with new employment opportunities being created by GCCs,” Dhanrajani added.
Multinational companies (MNCs) now have a deeper understanding of the vast talent pool in India, particularly in the fields of AI and digital technologies. “Along with growing confidence from parent organizations, it highlights the increasing number and depth of ownership by GCCs, signaling a significant surge in their growth,” Navaneet Mishra, head of Sweden-headquartered industrial technology firm Hexagon’s GCC in India.
This growing confidence in Indian setups shows the trust MNCs have in Indian talent.
2025 appears to be a transformative year for GCCs, with the industry’s focus on new opportunities in digital innovation, talent management, and business models.
Also read: IT companies set up dedicated GCC Strategic Business Units as demand booms
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