India’s GCC Era: The Centre of Gravity Has Moved East

Visa hikes, rising costs, and tightening labor rules are reshaping global hiring. Global firms are no longer importing talent as they’re building capability centers in India, where scale, skill, and speed now converge. A growing shift from outsourcing to ownership is happening as GCCs help build where the talent already is.

The Policy Shock That Exposed a Deeper Shift

In September 2025, a sudden change in US immigration economics forced global hiring teams to look again at a question many had avoided for years. The White House announced a one-time $100,000 payment requirement for certain new H-1B visa petitions, a number large enough to change hiring spreadsheets even before legal teams finished reading the fine print.

The detail matters because the fee was clarified as applying to new petitions rather than existing H-1B holders, as Reuters reported and as USCIS later stated in its H-1B FAQ. The immediate panic was about visas, but the deeper question was about architecture: if a company can access world-class capability in India, why should its first instinct still be to move that talent into the United States?

That is the real inflection point. The H-1B shock did not create the Global Capability Centre boom in India. It simply made the old model harder to defend. For three decades, high-skill immigration allowed companies to treat geography as a problem of movement. If a firm needed engineers, analysts, or product specialists, it could bring them closer to headquarters.

The visa system turned Indian talent into a mobile extension of Silicon Valley, Wall Street, and corporate America. The fee changed the marginal cost of that logic and forced leaders to compare the price of moving one person with the possibility of building an entire operating pod where that skill already lives.

The timing made the signal more powerful. Global firms were already dealing with wage inflation, talent shortages, tighter compliance rules, and a post-pandemic operating model in which distributed work has become normal. The H-1B fee arrived inside that wider context.

It was not a random policy story, but more of a boardroom prompt. Companies were being pushed to ask whether global talent strategy should continue to depend on relocation when collaboration systems, security tools, cloud development environments, and India’s own capability base had already matured.

This is where the GCC story becomes more interesting than the usual outsourcing narrative. The old offshore model sent work to India while the new capability model builds teams in India that own work, improve work, and create work.

This difference is not cosmetic as it changes where knowledge accumulates, where decisions are made, and where future innovation capacity sits. The center of gravity has begun moving from the company’s main office to the place where capability can be built fastest, deepest, and with the least operational friction.

The Old Model Moved Talent. The New Model Builds Capability.

For much of the modern technology economy, the default assumption was that high-value talent should move toward the headquarters. Indian engineers went to the US through graduate schools, multinational hiring pipelines, and the H-1B route because product strategy, capital, and senior decision-making still sat largely in places like Silicon Valley, Seattle, London, and New York. That model worked when collaboration depended heavily on proximity and when offshore work was still treated as a lower-cost execution layer.

The cost equation now looks very different. In the US, the median annual wage for software developers was $133,080 in May 2024, while the median for software quality assurance analysts and testers was $102,610, according to the US Bureau of Labor Statistics.

At the top end, software developers earned more than $211,450. That is before benefits, real estate, management cost, legal cost, and retention pressure enter the calculation. For companies hiring in AI engineering, cybersecurity, cloud architecture, and advanced analytics, the fully loaded cost is often much higher.

Then came the visa shock. USCIS guidance says new H-1B petitions submitted after 12:01 a.m. Eastern time on September 21, 2025 require a $100,000 payment, subject to the stated conditions. Reuters reported that the move applied to new H-1B visas and immediately drew legal challenges, including from US states that argued the fee could worsen labor shortages in critical sectors. The important point for companies was the policy risk but not just the legal fight. A hiring model that depends on relocating scarce talent has become more expensive, less predictable, and more exposed to politics.

At the same time, the case for keeping high-skill work physically close to headquarters has weakened. The pandemic forced companies to build infrastructure for distributed work: cloud development environments, enterprise security layers, remote collaboration tools, asynchronous workflows, and globally managed delivery systems. Once those systems became normal, distance stopped being the main problem. The real question became whether the company had the operating discipline to integrate teams properly.

That is why the GCC conversation has changed. India is not being evaluated only as a cheaper labour market. It is being evaluated as a full capability environment. The country already has the talent pipeline, recruiters, IT parks, compliance advisors, payroll systems, cybersecurity vendors, engineering managers, and global delivery experience required to build long-term teams.

NASSCOM and Zinnov estimate that India had over 1,700 GCCs in FY2024, employing around 1.9 million people and generating $64.6 billion in revenue. By 2030, they project 2,100-2,200 GCCs, 2.5-2.8 million employees, and $99-105 billion in revenue. Reuters reported the same forecast, noting that firms such as Chevron and Sanofi have committed large investments to Indian GCCs.

The company examples show the shift more clearly than the terminology does. JPMorgan Chase told Reuters in 2024 that it planned to grow its India headcount by 5-7% annually over the next few years, reinforcing how India has become a serious technology and operations base for global banking.

Costco’s planned Hyderabad technology centre, reported by Reuters in July 2025, shows that the GCC model has moved beyond the old software and banking core into global retail. Recent GCC announcements from Zurich Insurance and Heineken in Hyderabad also point in the same direction: India is being used for engineering, data, cybersecurity, finance, supply chain, HR, digital transformation, and core business functions, not merely back-office support.

This is the cleaner way to frame the shift: companies once used India mainly to reduce the cost of work. They are now using India to reduce the friction of building capability. The difference matters. A vendor relationship can buy capacity. A GCC or GIC-style model builds institutional memory, process control, data discipline, and long-term operating depth.

That is why the conversation is moving from outsourcing to Global Capability Centers, and from traditional GCCs to more flexible Global In-house Centre and plug-and-play models that give companies control without making them carry the full burden of entity setup from day one.

India’s GCC Scale is No Longer a Side Story

India’s GCC scale is now visible less in headline counts and more in the kind of companies choosing to build there. The older mental image was simple: large banks and technology firms created Indian centers for software support, operations, and cost efficiency. Such a picture is now too narrow.

The newer announcements are coming from pharma, energy, retail, insurance, consumer goods, cybersecurity, and industrial companies, which tells us something more important than the raw number of centers. India is no longer being used only as a technology back office. It is being used as a place where global companies can build repeatable capability across functions.

Sanofi is a useful example because it sits far outside the old IT-services stereotype. Reuters reported in 2024 that the French drugmaker planned to invest €400 million in its India global capability centre by the end of the decade, with the Hyderabad center hiring data scientists and engineers to strengthen its digital and AI capability.

In February 2026, Reuters reported that Sanofi planned to expand the centre further, growing its workforce from more than 2,600 employees to over 4,500, with roles across R&D, artificial intelligence, data innovation, analytics, medical affairs, and corporate functions. This is the kind of move that changes the GCC conversation change. A pharma GCC handling AI, clinical documentation, medical affairs, and data work is a capability-control story and not a labor-cost story anymore.

Chevron tells the same story from a different sector. In August 2024, the company announced that it would establish the Chevron Engineering and Innovation Excellence Center, called ENGINE, in Bengaluru. Chevron described the center as a hub for engineering and digital capabilities, with a focus on solving complex energy challenges through technology, engineering expertise, and innovation.

By October 2025, the company had inaugurated a new Bengaluru facility for ENGINE, reinforcing that this was not a short-term delivery experiment but a strategic technology presence in India. When an energy major builds an Indian center around engineering and innovation, it signals that GCCs are moving into domain-heavy work, not just shared services.

Retail is moving in the same direction. Reuters reported in July 2025 that Costco planned to set up its first India GCC in Hyderabad, initially employing around 1,000 people for technology and research operations. This is significant because retail GCCs are usually tied to data platforms, supply-chain intelligence, pricing systems, inventory technology, digital commerce, and customer analytics.

Costco’s decision places India inside the operating logic of a global retailer, not merely inside its IT support chain. It also puts Costco in the same broad India capability pattern already used by global retailers such as Walmart and Target.

The consumer-goods side is now joining the pattern as well. Heineken opened its first Asia-Pacific business services centre in Hyderabad in 2026, describing the facility as a contributor to finance operations, digital and technology services, data and analytics, and global business process transformation. Its own announcement says the center is part of Heineken Business Services and is expected to contribute to a network that grows to around 3,000 roles globally by 2030.

Local reporting added another useful layer: Heineken’s Hyderabad center is expected to support finance, supply chain, HR, digital transformation, and wider operations across Asia-Pacific, Africa, the Middle East, and Eastern Europe. This makes Hyderabad not just a support point for India, but a regional operating node for multiple markets.

What these examples show is that India’s GCC market is no longer proving itself through volume. It is proving itself through a functional range. Pharma companies are building AI and clinical operations capability. Energy companies are building engineering and innovation centers.

Retailers are building technology and research operations. Consumer-goods firms are building finance, supply chain, data, and transformation hubs. Insurance, cybersecurity, and financial-services firms are following similar logic. Once that range appears, India stops being a delivery destination and starts looking like a corporate operating environment.

This is the stronger way to understand India’s scale. It is no longer just the number of GCCs, the square footage leased, or the number of employees hired. It is the fact that global companies in very different sectors are trusting India with work that affects product, operations, risk, data, research, and transformation. This is what scale has matured into as it is no longer only the ability to hire thousands of people. It is the ability to absorb complex work from multiple industries and make it operationally dependable.

Why the Shift is From Cost Arbitrage to Capability Arbitrage

Cost still opens the India conversation, but it no longer explains why global companies keep expanding there. A cheaper team can reduce a budget line while a mature capability center can change how a company builds products, manages risk, improves systems, and preserves institutional knowledge over time.

This distinction is now visible in the type of work moving into India. The work is no longer limited to maintenance, support, and process execution. It increasingly includes engineering ownership, AI infrastructure, cybersecurity, digital operations, product development, clinical data, and domain-heavy decision support.

JPMorgan is a useful example because banking is one of the least forgiving sectors for weak operating models. Reuters reported in 2024 that JPMorgan planned to grow its India headcount by 5% to 7% annually over the next few years, adding to a large India base that supports international operations.

This expansion is not simply a labor-cost decision. Global banks do not place critical technology, risk, data, and operations work in a geography only because salaries are lower. They do it when the operating ecosystem can meet standards around control, continuity, compliance, and domain expertise. In banking, the cost of process failure is too high for simple wage arbitrage to be the real explanation.

Microsoft shows the same shift from another angle. Its India Development Center, set up in Hyderabad in 1998, is described by Microsoft as one of its largest R&D centres outside Redmond, with facilities in Hyderabad, Bengaluru, and NCR working on AI, cloud, enterprise, productivity tools, gaming, and core engineering services.

In 2025, Microsoft also announced a proposed Noida IDC campus spread across 15 acres and 1.1 million square feet, positioned as a hub for AI, cloud, and security. This is not a company using India as a low-cost coding bench. Instead, it is a company embedding India inside its global product and engineering system.

Target in India, works across technology, data science, product management, marketing, finance, supply chain, merchandising, and enterprise operations. This matters because retail capability is no longer just store support or basic IT maintenance.

Modern retail runs on pricing engines, inventory intelligence, digital commerce, customer analytics, fulfilment systems, and private-label strategy. Target’s India operation shows how a GCC can sit inside the operating brain of a retailer, supporting decisions that affect customer experience, supply chain efficiency, and digital growth.

This is where the arbitrage has changed. The old equation compared the cost of one worker in India with the cost of one worker in the US or UK. The new equation compares what a stable, integrated Indian capability base can accumulate over years: codebase familiarity, product context, compliance knowledge, customer logic, process memory, and data discipline.

A vendor team may deliver a project well, but the knowledge often sits across account layers, handovers, and changing delivery teams. A GCC or GIC-style team absorbs learning into the company’s own operating rhythm. Over time, the India team becomes faster because it knows the system, not because it is cheaper.

The capability logic also explains why companies keep adding deeper mandates after the initial setup. Once a center proves that it can handle one layer of work, the next layer follows. A team that begins with reporting may move into analytics. Similarly, a software unit may move into product ownership, while a support team may become a customers’ operations intelligence hub. This progression is a real economic story.

Cost arbitrage produces a one-time saving while capability arbitrage produces compounding returns because every additional year improves context, trust, speed, and autonomy. That is the real reason India’s GCC story has moved beyond wage comparison. The advantage is in the depth of capability that can be built around that talent.

The Old Outsourcing Model Is Being Squeezed from Both Sides

Traditional outsourcing still has a place. It works when the work is clearly defined, the process is stable, and the client mainly needs capacity: customer support overflow, data processing, testing cycles, routine finance operations, maintenance, and other tasks where the value lies in reliable execution.

The pressure begins when the work becomes tied to business memory. Once a team needs to understand product logic, customer behavior, compliance risk, internal data structures, AI workflows, or decision history, the old vendor model starts showing strain.

The first squeeze is coming from large enterprises that are pulling higher-value work closer to themselves. They are not necessarily bringing it back to headquarters, but they are bringing it inside their operating structure. This distinction matters as a bank may still run work from India, but it increasingly wants the team to sit inside its governance, data controls, risk systems, product cadence, and long-term workforce planning.

This is why the global managed-services market is showing a split. ISG reported in October 2025 that cloud-based XaaS spending was growing strongly, while managed services annual contract value declined 2%, a sign that clients are spending heavily on technology platforms and transformation while putting more pressure on traditional service contracts.

The second squeeze is coming from the mid-market. Smaller and mid-sized companies have learned that low-friction outsourcing can become high-friction over time. The vendor may deliver the task, but the client often carries the hidden cost of explaining context again and again.

Product decisions get delayed because the external team does not understand the business deeply enough. Reporting improves, but judgement does not improve. Hiring feels fast at the start, but replacement cycles quietly drain continuity. Eventually, the contract looks efficient on paper, while the company loses speed in handovers, rework, dependency, and weak institutional memory.

AI makes that weakness more visible. McKinsey’s 2025 global AI survey says companies capturing value from AI are paying attention across six connected dimensions: strategy, talent, operating model, technology, data, and adoption at scale. AI is not a tool that can simply be handed to an external team without context.

It needs clean data, workflow knowledge, risk judgement, process redesign, and people who understand how the business actually makes decisions. A disconnected vendor can execute prompts, reports, dashboards, or automation tasks while an integrated team can improve the system that produces the work.

The pressure is already visible in India’s traditional outsourcing sector. Reuters reported in August 2025 that TCS planned to cut more than 12,000 jobs, its largest-ever layoff, while analysts described the move as part of a broader AI shake-up in India’s $283 billion outsourcing industry.

The report noted that clients are pushing for efficiency; automation is affecting coding, testing, and support roles, and mid-career professionals with weaker technical depth are under pressure. This does not mean outsourcing is dying. It simply means the lower-context parts of outsourcing are becoming easier to automate, cheaper to re-bundle, or harder to defend as standalone labor supply.

This is the real squeeze: at the top end, clients want ownership, control, and decision proximity; at the lower end, AI is attacking repetitive delivery. The middle ground of “we provide people to execute your tasks” is becoming less comfortable. Companies still need people, but they increasingly need those people to sit closer to business logic. They need teams that know why the work exists, how the process has changed, where the risks sit, and what the company is trying to improve.

That is where the Global In-house Centre, or GIC, idea becomes useful for mid-sized firms. A traditional GCC gives a large multinational control, but it also demands capital, legal setup, local HR, office infrastructure, compliance, and management bandwidth. A loose vendor model gives speed but often weakens control. A GIC-style remote setup sits between those two. The client owns direction, workflow, tools, standards, performance expectations, and team integration while the remote platform carries the local operating burden of hiring support, payroll, office infrastructure, compliance, IT administration, and continuity systems.

This model matters because the next stage of global capability will not be won by the cheapest provider. It will be won by the setup that preserves context. In AI-heavy operations, context is the difference between output and improvement. This is the gap traditional outsourcing has to close, and it is exactly the gap that mini-GCC and GIC models are beginning to fill.

The Mid-Market Is Entering a Game Once Reserved for Giants

The clearest signal that GCCs are moving beyond the Fortune 500 is the emergence of a defined mid-market category. Zinnov’s 2025 mid-market GCC report estimates that mid-market GCCs in India now have an installed talent base of more than 210,000 professionals, with over 45 mid-market GCCs set up between FY2023 and FY2025.

This matters because it shows the model is no longer limited to companies with billion-dollar balance sheets, global real estate teams, and large legal departments. The GCC idea is being broken into smaller, more modular operating units that mid-sized companies can actually use.

The definition of “mid-market” is also important. ANSR’s 2025 Emerging Enterprises GCC report defines the segment as companies with annual revenues up to $2 billion. This includes many firms that are large enough to need serious engineering, analytics, finance, customer operations, and AI capability, but not large enough to spend a year building an Indian entity from scratch.

These companies sit in an awkward operating gap. They have outgrown loose vendor dependence, but they are not always ready for the full legal and administrative machinery of a traditional captive center.

The market is already creating infrastructure for that gap. EY now offers Capability Center-as-a-Service, describing it as an end-to-end model for GCC setup, scaling, and transformation in India. Accenture’s 2025 GCC services material points to its partnership with ANSR and flexible operating models designed to help enterprises establish and scale GCCs efficiently. These examples show that the professional-services ecosystem now sees GCC setup itself as a managed capability layer, not just a one-time corporate expansion project.

The logic is similar to what happened in cloud computing. A company no longer builds its own data center before launching a software product. It uses AWS, Azure, or Google Cloud because the infrastructure layer already exists. The GCC setup is beginning to follow the same pattern.

The mid-market firm still wants control over the work, people, systems, and output. What it does not want is to spend its first-year learning employment law, leasing office space, building IT administration, payroll, local HR, and compliance operations before the actual team becomes productive.

This is why the time-to-capability question matters. A delayed engineering unit delays product releases; a delayed analytics team delays better decision-making, while a delayed finance operations team delays reporting discipline. For mid-sized firms, delay is not a setup inconvenience. It directly affects growth, customer delivery, and competitive timing. A large multinational can absorb a long setup cycle because it has parallel capacity elsewhere, but a mid-sized company often cannot.

The rise of mid-market GCCs also changes what “global expansion” means. Earlier, an Indian center was often a major corporate event: a legal entity, a large office, a leadership announcement, and a multi-year investment plan. In the mid-market version, it may begin as a 20-person engineering team, a 15-person revenue-operations unit, a finance analytics pod, or a customer success support layer. The first center does not need to look like a campus. It needs to prove that the company can build repeatable capability outside its home market without losing control.

This is why the mid-market GCC story is strategically important. It reduces the distance between ambition and operating reality. A company that could not previously justify a full captive center can now build a smaller, controlled capability base in India and expand as the business case proves itself.

This changes the competitive field. The ability to build globally is no longer reserved only for banks, hyper-scalers, and Fortune 500 firms. It is becoming available to companies that are still scaling, still resource-conscious, and still close enough to their own operations to feel every delay.

The Hard Economics: Why the Boardroom Calculation Has Changed

The economic case for GCCs is no longer only about labor-rate comparison. The sharper calculation is how much capital gets trapped before capability starts producing value. For many companies, especially outside the Fortune 500, the real issue is not the salary bill.

It is the long pre-productive phase including entity setup, tax structuring, office selection, leadership hiring, statutory registrations, cybersecurity design, HR policies, vendor contracts, device procurement, and internal governance alignment. None of that builds the product, improves the reporting cycle, clears the engineering backlog, or strengthens customer delivery. It is necessary infrastructure, but it delays the point at which the centre starts changing business outcomes.

This is why the setup model has become a board-level issue. EY’s GCC cost report frames GCC setup as a multi-variable decision involving location strategy, talent channel design, operating-model choices, partner ecosystems, real estate, tax, legal, and transition governance.

This matters because every added variable increases both cost and uncertainty before steady-state delivery begins. A company can have a strong India thesis and still lose momentum if the first year is consumed by scaffolding rather than capability.

A separate ANSR report on emerging enterprise GCCs shows why smaller companies are treating speed as part of the financial case. One banking-solutions provider cited in the report grew its India center from 65 people in 2022 to 350 people in 2025, while another global SaaS company scaled from about 50 employees to more than 250 in India within a similar window.

The point is that the financial value of an India center improves when the operating system lets the company move from intent to working capacity quickly. A center that takes too long to become useful can look rational in a spreadsheet and still fail the business.

The cost that often gets missed is opportunity cost. If an analytics team takes nine months to become operational, business leaders continue making decisions without the data systems they wanted. If an engineering unit is delayed, product releases slip while competitors keep shipping.

If a finance operations center takes too long to stabilize, reporting discipline remains weak for another planning cycle. In that sense, the first-year economics of a GCC are not only measured by setup expenditure. They are also measured by the business value deferred while the company builds the machine that is supposed to create that value.

This is why managed capability-center models have become relevant in the market. EY’s Capability Center-as-a-Service offering includes GCC setup, scale-up, talent, tax, legal, technology, workplace, procurement, program management, and transition support, which shows how the advisory ecosystem itself is packaging GCC creation as an operating layer. The signal is clear: companies still want India-based capability, but many do not want the first chapter of that strategy to be a year-long internal construction project.

The boardroom calculation has therefore changed from “What is the cheapest location?” to “Which model gets productive capability into the business fastest, with enough control to make the investment compound?” A traditional build may still make sense for a company with scale, patience, and capital.

A managed or hybrid model becomes attractive when speed, capital discipline, and operational focus matter more than owning every layer from day one. The economic argument is that the cost of delay has become visible enough for companies to price it into the decision.

Why India’s Talent Advantage Is Difficult to Copy

India’s advantage is not that it has talent. Many countries do. The harder thing to copy is the density of talent sitting inside a mature global-work ecosystem. A company building in India does not enter an empty labor market where it must create everything around the hire.

It enters a country where the hiring channels, engineering culture, workplace infrastructure, professional managers, training providers, compliance advisors, and global delivery habits already exist at scale. This surrounding system is what makes India difficult to replicate.

The developer base is one signal. GitHub’s Octoverse 2025 reporting projects India to become the world’s largest developer community by 2030, with more than 57.5 million developers. India already ranks second globally on GitHub, added 5.2 million new users in 2025 alone, and contributed more than 14% of all new sign-ups.

This matters because modern capability centers depend on active developer ecosystems, open-source exposure, cloud-native work habits, and AI-tool adoption, not just formal degrees. A market with millions of developers working inside global coding platforms gives companies a living technical base to hire from and train into deeper roles.

The AI-skills layer is also forming quickly. Coursera’s 2025 Global Skills Report said GenAI enrolments on its platform had risen 195% year over year and crossed 8 million globally, while Indian learners showed strong demand for AI credentials even though the country’s overall skills ranking still leaves room for improvement.

This contrast is useful because it keeps the argument honest. India’s advantage is not that every graduate is immediately world-class. It is that the learning market is large, fast-moving, and responsive to global skill shifts. When AI, cloud, data, cybersecurity, or automation demand rises, India has the learner volume and training infrastructure to respond faster than many smaller markets.

The professional-services layer strengthens the same point. India has built large pools of finance specialists, legal operations staff, medical billing professionals, content and marketing teams, CAD and engineering-design talent, cybersecurity analysts, HR operations teams, and customer-success professionals who are already used to serving global markets.

This breadth matters because a GCC rarely remains a single-function center for long. A company may begin with engineering and then add finance operations, analytics, product support, compliance, or marketing operations once the center stabilizes. Countries that support multiple business functions inside one operating environment become far more strategic.

India’s advantage is also institutional. The country has decades of experience running global delivery through IT services, business-process management, engineering services, captive centers, and professional consulting. This history has created a managerial class that understands offshore governance, client reporting, service levels, data security, time-zone coordination, and escalation discipline. A new GCC does not have to teach the market how global work is done as the habits are already embedded in the ecosystem.

The time-zone position adds a practical layer that rarely gets enough attention. India can overlap with Europe during normal working hours and with North America through early or late windows. This makes it possible to design a follow-the-sun rhythm without turning the entire operating model into a night-shift structure.

For software releases, analytics reporting, finance operations, customer support, and managed services, this creates a useful operating practice where work can move from one region to another, decisions can be prepared before leadership comes online, and delivery cycles can compress without forcing everyone into the same room.

This combination is the part competitors struggle to copy. A lower-cost country may offer wage savings; a smaller high-skill market may offer strong specialists; while a nearshore location may offer easier travel. India’s edge is that it can combine technical scale, domain breadth, English-language business fluency, global delivery memory, and time-zone utility inside one ecosystem. This is why companies do not treat India as a temporary labor pool once they experience the operating depth. They keep adding functions because the system around talent can absorb more work.

Why the GCC Story Is Now Tied to AI

AI has changed the GCC conversation because it has exposed the difference between buying software and changing work. The strongest evidence is not in AI hype, but in the implementation gap. McKinsey’s 2025 global AI survey found that companies capturing value from AI are working across six connected areas: strategy, talent, operating model, technology, data, and adoption at scale. That is exactly why GCCs matter.

AI value does not come from model access alone. It comes from the teams that decide which workflows should change, which data is reliable enough to use, where controls are needed, and how adoption should be managed inside the business.

The investment pressure is already large. BCG’s AI Radar 2025 survey of 1,803 executives found that one in three companies planned to spend more than $25 million on AI in 2025, while GenAI investments were projected to rise by 60% over three years.

Spending at that level creates a delivery problem as companies cannot keep AI as a boardroom promise or a pilot run by a small innovation team. They need engineering capacity, data governance, process redesign, model monitoring, change management, and domain specialists who understand how the work actually happens.

This is where GCCs become more than offshore support. EY’s 2025 GCC Pulse Survey reported that 58% of India GCCs are investing in agentic AI, while two-thirds are creating dedicated innovation teams to globalize ideas. This matters because agentic AI requires more than automation scripts.

It needs workflow mapping, data access rules, human review points, cybersecurity controls, and business-unit adoption. A center that already sits inside enterprise operations is well placed to do this work because it sees the process from the inside, not as an outside vendor receiving a task brief.

The type of GCC announcements now coming from India shows the same pattern. Zurich Insurance’s Hyderabad GCC is being built around cloud engineering, AI, data, application development, cybersecurity, and quality engineering, with the company positioning the centre as part of its wider global technology and customer-service modernization.

This is a useful example because insurance is process-heavy, data-heavy, and risk-heavy. AI in that environment cannot be reduced to chatbots as it touches claims, underwriting support, customer servicing, fraud detection, document processing, and compliance controls.

Microsoft’s 2025 Work Trend Index gives the operating-model angle. It argues that companies are moving from AI as an assistant to agents joining teams as “digital colleagues,” taking on specific tasks under human direction. The report says 82% of leaders see this as a pivotal time to rethink core aspects of strategy and operations.

This is an important phrase: rethink operations. Once AI agents enter the workflow, companies need people who can redesign the work around them, not just use the tools. GCCs that already combine technology teams with business operations become natural places to build that capability.

India’s GCCs are relevant because many already sit in that middle layer across finance, healthcare, insurance, retail, logistics, and enterprise technology. They are close enough to the process to understand the mess, and technical enough to improve it. This is why AI makes the India capability story stronger. The companies that scale AI will need operating centers that can convert models into working systems.

For some firms, that will mean dedicated AI and data teams. For others, it will mean upgrading finance, customer operations, software development, compliance, or analytics teams with automation and agentic workflows. In both cases, the question becomes less about where AI talent is cheapest and more about where AI work can be made operational. India’s GCC ecosystem is increasingly being used to turn AI into a repeatable enterprise capability.

The Indian Geography Is Spreading Beyond the Usual Metro Cities

The next stage of India’s GCC growth is less about replacing Bengaluru, Hyderabad, Pune, Chennai, or NCR and more about redesigning the map around function. The major metros will continue to hold headquarters-style roles because their ecosystems are deep, their leadership pools are mature, and global companies already understand how to operate there.

The change is that not every capability needs to sit inside the most expensive and crowded city. A finance operations team, QA pod, design unit, customer operations layer, cybersecurity support team, or analytics centre may perform better in a city where hiring is steadier, commutes are shorter, and employees are less likely to move every twelve months.

The early evidence is already visible. A 2025 InCommon report said Tier-2 cities’ share of India’s GCC footprint rose from 5% in 2019 to 7% in 2025, with more than 170 GCCs now spread across 18 Tier-2 cities including Kolkata, Ahmedabad, Vadodara, Indore, Bhubaneswar, Coimbatore, Kochi, Lucknow, Jaipur, Nagpur, and Mysuru. The numbers are still small compared with the metros, but the direction matters. These cities are no longer just talent feeders but fast becoming operating locations in their own right.

The push is being helped by policy, not only by cost pressure. Karnataka’s “Beyond Bengaluru” initiative created around 5,600 jobs in Tier-2 cities such as Hubballi-Dharwad, Mangaluru, and Mysuru between FY2021-22 and FY2024-25, according to the Karnataka Digital Economy Mission, with IT companies and GCCs among the contributors.

Mysuru has seen warm-shell office spaces, a 1,000-seater global tech center, and semiconductor-linked investments, including AT&S and Kaynes Technology projects around the wider region. This is important because Tier-2 expansion only works when cities have office stock, power, connectivity, airport access, colleges, and state-level execution. Talent alone is not enough.

EY’s work on GCC movement into Tier-2 cities makes the operating logic clearer: attrition in Tier-2 locations can be up to 10% lower than in Tier-1 locations, while lower rentals and improving infrastructure make these hubs more attractive for specific functions.

This is not a soft advantage. Attrition is one of the biggest hidden costs in capability work because every resignation removes context, slows delivery, and forces managers to rebuild trust with a replacement. A slightly lower salary bill is useful, but a more stable team is often more valuable.

The city-level logic also differs by function. Coimbatore’s advantage is not identical to Jaipur’s. Kochi does not offer the same labor mix as Indore. Mohali and Chandigarh sit close to the North Indian engineering and services belt. Kolkata has long produced English-fluent finance, content, design, analytics, and back-office talent, while also offering lower operating costs than NCR or Bengaluru.

Mysuru and Mangaluru benefit from Karnataka’s broader technology ecosystem without carrying Bengaluru’s congestion. The key point is that India is becoming granular enough for companies to choose location by capability, not just by brand familiarity.

Dun & Bradstreet’s 2025 GCC report describes the same movement as a response to rising costs and talent saturation in Tier-1 metros, with companies increasingly looking at Tier-2 cities such as Jaipur, Kochi, Visakhapatnam, and Vadodara. The report also connects this to automation and digitization, which allows staff in distributed locations to focus on higher-value tasks rather than being limited by geography.

This matters because the spread beyond metros is not only a real-estate story. It is connected to how work itself has become more digital, measurable, and distributable. India’s GCC market is moving from city concentration to capability allocation. The first question used to be, “Should we set up in Bengaluru or Hyderabad?” The better question now is, “Which city fits this function best?”

Conclusion: The Centre of Gravity Has Moved

The H-1B shock made headlines because it was easy to see. A visa cost changes, companies react, hiring teams recalculate. The deeper shift is less dramatic but more important. Global companies are no longer designing talent strategy around the assumption that their best people must move toward headquarters. They are learning to build serious capability where talent already lives.

India’s role in this shift is no longer based on cost alone. That frame is too small for what is happening now. The country has become a working environment for global capability: deep technical talent, domain breadth, mature service infrastructure, experienced managers, improving compliance systems, and cities that can support different kinds of work at scale. The evidence is already visible in the way global firms are using India for AI, engineering, analytics, finance, product, cybersecurity, healthcare operations, retail technology, and transformation work.

This changes the strategic question. Companies are not simply asking whether India can reduce operating cost. They are asking whether they can afford to build the next decade of capability without India. In a world of expensive talent, policy uncertainty, AI pressure, and resilience demands, that question will become harder to avoid. The centre of gravity has moved east because capability has moved east. The companies that understand this early will build a more durable operating system for global work.