Indian IT Firms Vie For Higher GCC Pie

Revenue Proposition

♦ IT firms engaging with senior leaders of GCCs

♦ Projects from GCCs usually accounted under the country of origin

♦ More outsourcing decisions are taken from Indian centres

Why GCC Focus

♦ With 1,700 GCCs, India accounts for 17% of global captives

♦ These generated $64.6-bn export revenue, employed over 1.9 mn people

♦ GCC number may touch 2,200 by 2030, employing 2.5-2.8mn

Usually, IT firms show the earnings from GCCs on the head of those regions to which the company belongs. This is the usual practice - Pareekh Jain, founder, Pareekh Consulting, tells Bizz Buzz

Bengaluru: Domestic IT services companies are going aggressive in their sales efforts towards GCCs (Global Capability Centres) in India for getting more outsourcing contracts from these entities.

Many senior executives of Indian IT firms said GCCs in India are doing cutting-edge technology work and want to partner with IT vendors in several areas. Therefore, regular engagement with senior executives of GCC leaders becomes an imperative for sales people, they added.

“Indian IT firms’ engagement level with GCCs is rising because global companies are getting many critical technology works done out of India. In these areas, the decision for outsourcing work to IT vendors is usually taken from Indian technology centres. That is the reason, sales efforts with regard to GCC engagement is increasing,” said a senior executive of a Bengaluru-headquartered mid-tier IT firm.

“Though final decision for outsourcing of projects is not taken from Indian centres, these usually emanate from India. So, relationship with Indian GCCs of foreign companies is critical to clinch those deals,” the person added.

According to a recent Nasscom-Zinnov India GCC landscape report, total number of GCCs set up in India has increased to 1,700 in the fiscal year 2024. These GCCs generated $64.6 billion in export revenue and employed over 1.9 million people, the report said.

“The impact of GCCs on India’s economic fabric is profound and far-reaching. India now accounts for 17 per cent of the global Technology Capability Centers footprint, the largest share in the world. It’s a testament to India’s emergence as the GCC capital of the world,” the report has said.

It also projected that India would have 2,100-2,200 GCCs by 2030, employing around 2.5-2.8million.

Analysts pointed out that the earning from the GCCs in India are usually accounted as revenue coming from the country of origin of the foreign company.

“Usually, IT firms show the earnings from GCCs on the head of those regions to which the company belongs. This is the usual practice,” said Pareekh Jain, an IT outsourcing advisor & Founder of Pareekh Consulting, told Bizz Buzz.

He also said that technology captives are focused on executing critical technology projects for their companies with a preference of outsourcing others like testing, maintenance and related projects.

With rising number of GCCs outsourcing work, Indian IT firms are sensing higher opportunities coming from these captives in the coming quarters.