India’s Global Capability Centre (GCC) landscape is undergoing a transformation. While cities like Bengaluru, Hyderabad, and Chennai have long dominated the space, the central government’s new national framework for GCCs promises to decentralise this growth and tap into the potential of Tier-2 and Tier-3 cities.

This push is backed by some of India’s leading state governments—Karnataka, Telangana, and Tamil Nadu—who collectively host more than half of the country’s GCCs. With India already housing over 2,970 GCCs employing 1.9 million people, the goal is to expand this footprint while contributing a projected 3.5% to India’s GDP by 2030.

A Policy Shift: From Organic to Orchestrated Growth

Until now, GCC growth in India has been organic, led by favourable city ecosystems and global demand. However, the announcement by Finance Minister Nirmala Sitharaman on February 1 of a national framework marks a pivotal shift to policy-led growth.

According to Karthik Padmanabhan, Managing Partner at consulting firm Zinnov, “The national framework, combined with state-level execution, is widening India’s moat as the world’s GCC capital.”

States are now working closely with the Centre, submitting recommendations that reflect their unique strengths and aspirations.

Karnataka: Focus on Infrastructure and Talent Development

As one of the most mature GCC markets, Karnataka is demanding foundational support to unlock new GCC clusters beyond Bengaluru.

According to Ekroop Caur, Principal Secretary, IT-BT, Government of Karnataka, the focus must be on connectivity and infrastructure, not just to Bengaluru but also to other emerging towns.

“In terms of physical infrastructure, connectivity plays a very, very important role,” she said.

This includes not only roads and space but also social infrastructure like:

• Quality healthcare

• Education facilities

• Standard of living

These are crucial to attract companies that want to move operations to new regions.

Karnataka is already investing in talent readiness for emerging technologies and aims to build a future-ready workforce in places beyond the state capital. This includes industry-focused skilling programs that prepare workers for IT and tech-related jobs.

Caur pointed out the network effect of GCCs, where once a couple of companies set up shop in a city, ecosystem development follows rapidly.

Karnataka’s GCC Policy, launched on November 19, 2024, was the first such state-level framework. It aims to:

• Create 3.5 lakh new jobs

• Generate $50 billion in economic output

• Position Karnataka as a global innovation hub by 2030

Tamil Nadu: Ready Infrastructure, Asks for Tax Breaks

While Karnataka is working to build, Tamil Nadu claims that its Tier-2 cities are already equipped with the necessary infrastructure.

According to Darez Ahamed, MD & CEO of Guidance Tamil Nadu, the state’s ask is simple: tax breaks.

“If there are specific tax breaks or income-tax holidays for GCCs set up within SEZs in Tier-II and III cities, that would be useful,” Ahamed told Moneycontrol.

Guidance Tamil Nadu, the state’s nodal agency for investments, believes fiscal incentives from the Centre can significantly boost GCC setups in cities like:

• Coimbatore

• Madurai

• Tiruchirappalli

Tamil Nadu is already offering:

• Salary-linked subsidies

• Women-friendly workplace transport

• Inclusion-focused policies

The state wants the Centre to complement these efforts and create a cohesive national push for GCCs.

Telangana: Talent and Curriculum Co-Creation

Telangana, especially Hyderabad, has emerged as a GCC powerhouse. The city alone is home to 20% of India’s GCCs. Now, the state wants to extend this momentum into Tier-II locations like:

• Warangal

• Nizamabad

• Karimnagar

• Khammam

According to Jayesh Ranjan, Special Chief Secretary (IT), the state is actively investing in:

• Broadband and digital infra

• Local skilling through initiatives like Young India Skills University (YISU)

What Telangana now seeks is collaboration with the Centre to:

• Co-create curriculum with top academic institutes

• Scale up successful skilling models

• Establish Centres of Excellence (CoEs) in emerging tech

These CoEs are envisioned as anchor institutions that can:

• Drive academia-industry linkages

• Attract global enterprises

• Stimulate local economies

States Offer, Centre Amplifies: A National Vision

Experts agree that the Centre’s role is to amplify the efforts already underway in the states.

“States are offering ready office spaces, skilling programmes, and inclusion policies. The Centre’s role now is to amplify these efforts with coordinated vision and regulatory clarity,” said Karthik Padmanabhan of Zinnov.

He emphasises that the impact of decentralising GCCs is not just about jobs—it's about building resilient and future-ready micro-markets.

The framework could soon support new GCC clusters in cities like:

• Bhubaneswar

• Nagpur

• Vadodara

• Coimbatore

Each of these regions has sector-specific strengths and cost advantages compared to metro cities.

The Road Ahead: A Collaborative GCC Revolution

With a clear policy intent and state-level enthusiasm, India is poised to become the undisputed leader in the GCC space globally.

The GCC framework promises to:

• Decentralise growth

• Empower Tier-2 and 3 cities

• Unlock job creation and innovation

• Boost India’s digital and economic capacity

If implemented effectively, this will not only reduce metro congestion but also provide high-quality employment opportunities closer to people's hometowns.

The combination of infrastructure support, skilling partnerships, and fiscal incentives can transform the way the IT and tech sectors grow in India.

The Current active IPO are Srigee DLM, Manoj Jewellers, Wagons Learning, Kenrik Industries.

The Closed IPOs are  Arunaya Organic, Ather Energy, Iware Supplychain Services.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst.