Bengaluru hosts half of India's mid-market GCCs, says Zinnov-KDEM report

Such smaller GCCs now make up about 27% of the country's total GCC ecosystem

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Bengaluru is now home to almost half of the country’s mid-market global capability centres (GCC), helped by higher maturity curve, depth in engineering talent, availability of niche skills, presence of GCC leaders, and the state’s favourable policies, a report said.

 

Mid-market GCCs are those which are set up by mid-sized companies with annual revenue between $100 million and $1 billion. They focus on delivering high-value, specialised services while maintaining a leaner operating model, compared to its larger peers.

 

The report by Zinnov, in collaboration with the state government and Karnataka Digital Economy Mission (KDEM), says that India’s technology capital has more than 230 mid-market GCCs out of the 480 in India, making it the epicentre of the next GCC growth wave. Those centres employ about 74,000 people.

 

Nilesh Thakker, president of Zinnov’s globalisation excellence practice, said the smaller centres run on lean

 

teams that ship code quickly, own P&L responsibilities, and drive core product development across AI, cloud, cybersecurity, and analytics for their parent organisations.

 

“These centres arrive with a clear brief. Do a few things, and do them exceptionally well. That pace is possible because Karnataka already supplies what they need: a deep pool of digital talent, start-ups that double up as idea laboratories, universities,” he added.

 

India has about 1,760 GCCs, according to data by IT industry body Nasscom, which is expected to touch 2,000 in the next few years. The sector has hired more than the IT services industry over the next two years, as growth slowed in the latter. There are more than 500 GCCs with AI capabilities, up from just a little over 200 in 2023, with a holistic global AI charter.

 

While the focus initially has been on the large GCCs, mostly the technology centres of big US and European banks, over the last few years, smaller GCCs which require a few hundred people, have been on the rise in India.

 

“The government of Karnataka remains unwavering in its commitment to enabling this growth. The state launched India’s first-of-its-kind GCC Policy, alongside the visionary ‘Beyond Bengaluru’ initiative, which aims to decentralise growth, improve ease of doing business, and foster innovation across emerging cities,” Priyank Kharge, Karnataka’s minister of information technology & biotechnology and rural development & panchayat raj, said on Tuesday.

 

Such smaller GCCs now make up about 27 per cent of the country’s total GCC ecosystem, showing the segment’s steady growth momentum. These centres, according to experts, are no longer just delivery hubs but strategic innovation partners for global enterprises.

 

US mid-market companies continue to hedge their bets on the southern state, drawn by talent, ecosystem maturity and expansion potential. Out of the total units, 79 per cent are from the US and five per cent from the UK. In terms of vertical mix, 67 per cent are from the software and internet sector and 10 per cent from telecom.

 

BV Naidu, chairman of Karnataka Digital Economy Mission (KDEM), said the state stands out as a strategic hub, particularly within the software and internet sector, which leads in both the national and state contexts.

 

“The fact that over 50 per cent of mid-market GCCs in Karnataka have site leaders holding dual roles, combining GCC leadership with global or business unit responsibilities, highlights the strategic value these centres bring,” he added.

 

The report added that the mid-market centres in Bengaluru are operating at a high growth velocity of 1.4 times the national average aided by focused mandates, lean governance, tighter headquarter alignment, and presence of leaders at N-1 and N-2 levels. 48 per cent of India’s engineering talent for these centres are based in Karnataka, nearly 1.7 times the national average.