GCCs boosting services exports, second only to IT services

GCCs have now become vital to India's economic framework, contributing more than 1% to the country's GDP.

Global Capability Centres (GCCs) have significantly boosted the country’s services exports, with the ‘other business services’ emerging as the second-largest contributor to services exports in FY24, accounting for 26%, just behind IT services which led with 48%, according to the Economic Survey.

GCCs have now become vital to India’s economic framework, contributing more than 1% to the country’s GDP.

As of 2023, India houses over 1,600 GCCs, and according to a PwC report, this number is expected to reach 2,100 by 2028, with the market size of these centres projected to touch $90 billion.

GCCs currently employ around 3.2 million people, primarily engineers and scientists. In FY23, these centres provided jobs to over 1.66 million professionals, with 42% engaged in engineering, research, and development (ER&D), 34.5% in business process management (BPM), and 23.4% in IT services.

GCCs are increasingly expanding into tier-II cities, driven by reverse migration during the pandemic and cost advantages. A CBRE research report indicated that 22% of new GCC centres were set up in tier-II cities in the second half of 2023, leveraging fresh talent pools and improved infrastructure.

Further, while the US and European MNCs have traditionally led the establishment of GCCs in India, companies from the Asia-Pacific region, particularly Japan and South Korea, are now setting up R&D and innovation centres.