Karnataka aims to double GCCs to 1,000, creating 350,000 jobs by 2029

A draft policy launched by Karnataka includes various incentives for foreign firms including reimbursement of rental costs, assistance with patent fees, and exemptions from certain duties

Karnataka is set to strengthen its position in the global outsourcing landscape by targeting a doubling of its Global Capability Centres (GCCs) to 1,000 and generating 350,000 new jobs by 2029. This goal was outlined in a draft policy launched on Friday.

The draft policy outlines a range of incentives designed to attract foreign firms, including reimbursement of rental costs, assistance with patent fees, and exemptions from electricity duty tied to the number of employees at a GCC. Additionally, the Karnataka government aims to achieve an economic output of $50 billion through these new offices by 2029.

In a post on X (formerly Twitter) Deputy Chief Minister D K Shivakumar said, “Our vision through this policy is to host over 15 per cent (330) of Forbes 2000 enterprises by 2030, creating more than one million jobs across all sectors. This will further strengthen Karnataka’s position as the global tech hub.”
 

GCCs, which began as low-cost outsourcing hubs, have evolved into multifaceted centres supporting various functions for their parent organisations, including daily operations, finance, and research and development. Currently, over 1,700 GCCs operate across India, employing more than 1.9 million individuals.

According to a recent report by IT industry body Nasscom and consulting firm Zinnov, this figure could rise to between 2,100 and 2,200 GCCs by 2030, employing an estimated 2.5 million to 2.8 million people.

The Karnataka government has stated that the new incentives aim not only to enhance the state’s GCC footprint in Bengaluru but also to encourage companies to establish operations in emerging cities such as Mangaluru, Mysuru, and Tumakuru. To support this initiative, the government plans to set up three new tech parks, fund skills training courses, and provide grants for research projects, particularly those focused on artificial intelligence. The draft policy will remain open for public feedback until November 11.

Bengaluru: A GCC hub

Bengaluru currently stands as India’s premier hub for GCCs, accounting for 36 per cent of the GCC workforce in the first two quarters of FY25, according to a recent report by TeamLease Digital. This dominance is largely due to the city’s thriving high-tech sector, which constitutes 37 per cent of the total GCC workforce. Professional services, including banking, financial services, insurance (BFSI), and consulting, represent another 21 per cent, while the manufacturing sector — primarily automotive and electronics — contributes 10 per cent, highlighting Bengaluru’s growing importance in the global tech and manufacturing landscape.

Over recent years, GCCs have emerged as key drivers of innovation and job creation across various industries. As they continue to evolve, partnerships with these centres are expanding to address the increasing demand for niche skills and the co-creation of new job functions.

Moreover, significant growth has been observed in sectors such as healthcare, BFSI, and retail, which have recorded compound annual growth rates (CAGR) exceeding 30 per cent between 2021 and 2023. Despite a slowdown in the broader IT sector during the same period, the GCC software and internet sector has thrived, with a projected CAGR of 6.2 per cent by 2027. The retail and e-commerce GCC sectors are anticipated to experience even stronger growth, with expected CAGRs of 8.4 per cent, followed by healthcare at 7.5 per cent.