India's GCCs Shift from Back Offices to Global AI and R&D Powerhouses

The report from The Hindu said nearly 58 per cent of Global Capability Centres (GCCs) in India are investing heavily in Agentic AI, that can reason and execute complex tasks moving beyond experimentation to enterprise‑scale deployment.

Indian GCCs now act as Centres of Excellence for finance, legal, and human resources, driving R&D in quantum computing, semiconductor design and AI, with end‑to‑end product life cycles often surpassing headquarters in technical depth, the report further said.

These GCCs allow parent companies to centralise their most critical functions in a high-skill, high-efficiency environment.

"These centres now manage global strategy leadership, high-end research and development (R&D), and proprietary intellectual property (IP) creation, making them indispensable nodes in the global value chain," the report said.

Indian GCCs have evolved through four distinct waves, from captive centres to exploit labour arbitrage and handle routine IT and business process tasks to the current GCC 4.0 era, and finally toward end-to-end product ownership, it added.

The report urged measures for GCC expansion through single‑window clearance, transfer pricing norms, tax safe harbours for R&D-intensive operations and industry‑academia collaboration.

It hailed the National GCC Policy Framework, proposed in the Budget 2026-27. "To secure India's position as the world's innovation capital, policymakers must transition from regulators to active facilitators," the report said.

With India housing over 1,800 GCCs and employing nearly two million professionals, companies can now drive faster innovation cycles through a follow-the-sun model, it noted.

Global Capability Centres (GCCs) could account for up to 50 per cent of India's office space demand across the top seven markets as US firms continue to dominate leasing activity, a recent report said.

The report from Colliers India said that US firms have accounted for close to 70 per cent of GCC leasing activity in India since 2020, followed by EU and UK companies at an 8-10 per cent share each.

The annual Grade A office uptake by GCCs could reach 35-40 million sq ft over the next few years, accounting for 40-50 per cent of overall office demand.

- IANS