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18 new GCCs set up in India in H1 CY2023: nasscom- Zinnov Report

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India continues to be the prime destination for global companies to set up their capability centers. The country’s technological capabilities to drive innovation, availability of highly skilled digital talent, mature tech start-up ecosystem, and the peer GCC ecosystem are some of the key drivers that make India an attractive destination for setting up and expanding GCCs, as highlighted in the nasscom-Zinnov report titled, India GCC Trends – Half Yearly analysis, H1CY2023, released today.

As of FY2023, India is home to 1580+ GCCs, with a total market size of USD 46 Bn, growing at a CAGR of 11.4%. The segment has not just expanded in terms of scale but also value. Of the 18 new GCCs established in the country during the first half of CY2023, approximately 83% have all three functional areas of Engineering R&D, IT, and BPM. Interestingly, around 55% of the new GCCs in H1CY2023 have instituted or expanded in locations other than Bengaluru, the primary choice. Tier-II cities such as Vadodara, Nasik, and Coimbatore saw the expansion of centers for established GCCs in verticals such as Industrial, FMCG, Retail, Electrical & Electronics, and Software & Internet.

GCCs are increasingly acting as core tech hubs for their HQs, specializing in niche skills around Cloud, Artificial Intelligence (AI)/Machine Learning (ML)/Natural Language Processing (NLP), Cybersecurity, Low Code/No Code (LC/NC), Advanced Analytics, Blockchain, Internet of Things (IOT). As of June 2023, the 1580+ GCCs in India house over 1.66 Mn talented professionals. Indian GCCs act not only as the incubation ground for digital enablement but also actively handle end-to-end digital requirements of their parent organizations. Both new as well as the expanding centers of existing GCCs are focusing on new-age technology areas such as Data Science, Data & Analytics, Digital Innovation, Web Applications, Platform Engineering, Automation, and Software Development. This further solidifies India’s position as a leading hub for niche digital skills.

Sukanya Roy, Head GCC and BPM at nasscom, said, “With an unwavering commitment to cultivating domain expertise and embracing sustainable practices, India is positioned to transform into the premier hub for GCCs, catering to the comprehensive requirements in digitally skilled talent, strategic location, visionary leadership, and operational excellence. This robust ecosystem not only strengthens India’s tech industry but also fosters deep-seated collaborations with start-ups, educational institutions, and external partners to leverage India’s state-of-the-art technologies and drive innovation for their HQ organizations.”

Mohammed Faraz Khan, Partner at Zinnov, added, “India’s 1580+ Global Capability Centers (GCCs) are continuing to evolve from support function hubs to strategic value centers, cementing the country’s position as a destination for world-class talent and innovation. In Automotive and Aerospace sectors, transformation from hardware led to software – led engineering has broadened the role of India centers, India’s prowess in cutting-edge Software, Digital Engineering coupled with technology talent highly skilled in embedded software, cloud computing, Artificial Intelligence (AI), Machine Learning (ML), and deep learning, are helping global companies reshape the landscape of these sectors from India.

The best part is that India contribution to the GCC innovation for these industries is no longer restricted to Tier 1 cities like Bengaluru, Hyderabad or Pune but has also expanded to Tier 2 cities like Thiruvananthapuram, where top automotive players have set up Centers of Excellence (COEs) to nurture a talent pipeline which will help them steadily build capabilities for the future.”

The report, a collaborative study by nasscom and Zinnov, identifies 7 key pillars that support the growth of the GCC ecosystem in India. This includes Generative AI Paradigm, India’s engineering prowess, excelling in the digital age, becoming a Global Business Services (GBS) powerhouse, sandbox for global leadership, mastering networked globalization, and unlocking India’s new talent code. These pillars collectively reinforce India’s position as an attractive hub for GCCs, offering a potent blend of technological innovation, skilled talent, and strategic advantages in the digital era.

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