A pre-midterm poll rhetoric in the form of a ‘war’ against migrants in the US from President Donald Trump and his deputy, Vice President J.D. Vance — massive purge of H-1B visas and blocking companies from using this route for sourcing talent — could well be a blessing in disguise for India. Though unintentional, it may well increase the growth of GCCs in India.

Industry veterans see the most recent US action on purging Green cards for H-1B workers and halting Perm certifications for several companies in the US as moves that could lead to more action on the GCC front here as some American work can move to India. Karnataka will benefit most from this possibility, which has been recently challenged in the GCC arena by other states, especially those in the neighbourhood.

Just two years ago — in 2024 — Karnataka was the first state to come up with a clear cut GCC policy. Other states were still drafting theirs to woo global corporations. This is why Bengaluru remains India’s GCC leader just as it has been the country’s technology and innovation capital — all because of investments in state for decades for policy creation and talent creation as part and parcel of its governance model that created an ecosystem which other states aspired to have. Investments over decades of policy continuity and talent creation built an ecosystem that attracted hundreds of multinational corporations.

Others Catching Up

Telangana, Tamil Nadu, Maharashtra, Gujarat, and Andhra Pradesh are all pursuing their own GCC ambitions with incentives, infrastructure plans, and investment targets in tow. The battle for India’s next wave of Global Capability Centres has really started now; and for Karnataka it can no longer take it for granted. But if there is one lesson from Bengaluru’s rise, it is that ecosystems are much harder to build than buildings, giving incentives, or making policy announcements.

Bengaluru has been a magnet for the world's technology industry for nearly four decades. What began as software development and captive technology centres for multinational companies today has become one of the world’s largest GCC clusters. Today GCCs in India don’t just serve as support centres — they also design products, artificial intelligence, cybersecurity, chip design, research, data analytics, and strategic business functions for some of the biggest companies in the world.

But competition has come from elsewhere recently, but Karnataka is still the leader in this transformation. Karnataka government estimates put Bengaluru, with 875 GCCs - almost a quarter of India’s GCC ecosystem, as its home and the country’s clear leader. Karnataka’s GCC policy will consolidate that position and take the industry beyond Bengaluru to Mysuru, Hubballi, and Mangaluru as well.

The Karnataka GCC policy aims to grow the number of GCCs to more than 1,000 by 2029. “What separates Bengaluru is not scale — it’s our ecosystem maturity,”, said Priyank Kharge, Karnataka IT and Biotechnology Minister, at a function. He says the state leads because of policy continuity, innovation networks, startup activity, talent availability and being able to support large-scale global operations. Industry observers concur with this assertion.

Uday Bhaskarwar is a senior GCC industry advisor who watched the growth closely: Bengaluru’s biggest USP is a self-sustaining ecosystem built over decades. “What happens is there’s more talent, more people, and more leadership,” the Pune based advisor says. That concentration of talent has created a virtuous cycle. Companies come to Bengaluru and Karnataka because the talent pool is there already. Skilled professionals move to the city because companies are already there. Venture capital follows innovation. Startups come out of multinationals. Experienced executives move between startups and global enterprises. The ecosystem keeps itself replenished, he says.

Bengaluru Still First Choice

Bengaluru is still the natural place for most multinational corporations to start entering India. “When companies think of India, Bengaluru is often the first city they look at,” Bhaskarwar says. 

Its “quality/quantity” mix of talent remains a powerful attraction. And Karnataka’s strongest supporters know that success has brought new problems too. “The three problems in Bengaluru are infrastructure, infrastructure, and infrastructure,” Bhaskarwar says bluntly.

Traffic jams, stress in cities, and rising costs have been increasingly worrying investors as well as employees. Industry executives joke in private that going from Bengaluru airport to some tech corridors can take longer than travel between major Indian cities. These pressures have created an opportunity for rival states, Bhaskarwar feels.

The Hyderabad Challenge

If there is one city which has emerged as Bengaluru’s most credible challenger in its neighbourhood, it is Hyderabad. GCC presence is increasing, the infrastructure is modernised, and the investment campaign is strong in Telangana which is attracting more MNCs. They are working on developing a GCC model for Hyderabad so that talent is available there and execution speed and cost will be faster. Telangana’s pitch is simple: many of the advantages of Bengaluru minus some of the pain points in the urban setting.

State leaders are also promoting expansion beyond Hyderabad to new regions like Warangal and Karimnagar for next generation technology and GCC clusters, media reports say.

Now, A National Contest

The competition is no longer Telangana centric. Tamil Nadu launched a GCC promotion programme for payroll linked incentives for high value jobs and promoted investment in Coimbatore and Madurai along with Chennai. The state is using its deep manufacturing capabilities, engineering talent pool, and automotive ecosystem to attract product engineering and advanced research centres. Andhra Pradesh sees Visakhapatnam as a future GCC destination – with lower costs, land availability, and strong infrastructure push.

Maharashtra continues to benefit from the strengths of the Mumbai-Pune corridor: financial services, fintech, and engineering-led GCCs. Gujarat is meanwhile using GIFT City to attract financial services, fintech, and global banking operations. Even the tiny state of Goa has joined the fray, with a GCC and an AI Excellence destination to promote innovations and entrepreneurship. The idea is to market Goa as a digital innovation hub and also as a travel destination as it is today. According to the state government, GCC will bring businesses, academic institutions, and entrepreneurs together.

For the first time, virtually every major state has said GCCs are a strategic growth sector.

The Karnataka Ecosystem

Yet there is still a difference between attracting a GCC and building a GCC ecosystem.

D.V. Prasad, former Additional Chief Secretary (Commerce & Industry) Government of Karnataka, has seen the state’s industries and technology journey and says that ecosystems cannot be created overnight by incentives alone. 

Bengaluru’s success, he says, is built on decades of establishment: educational institutions, research centres, public sector technology enterprises, engineering talent, entrepreneurial culture and policy continuity. The Indian Institute of Science, a huge network of engineering colleges, one of India’s biggest startup ecosystems, and generations of technology professionals have all come together to create what many in the industry call “deep ecosystem advantage”.

“That advantage is not easy to quantify in incentive packages,” Prasad says. A multinational corporation building a GCC in Bengaluru has engineers but also senior leadership talent, startup founders, venture capital networks, academic partnerships, technology vendors and service providers. Those connections have been built over four decades. Competing states can copy policy frameworks, but relationships are harder to replicate.

The AI Wildcard

Ironically, the big challenge for Karnataka’s GCC leadership may not come from Hyderabad or Chennai or Pune. It might come from artificial intelligence. “There is a bigger force that is playing right now and that is AI,” says Bhaskarwar. 

As companies move towards AI driven automation, questions are being asked about how GCCs themselves will change. Routine work is already being automated. Now the question is whether AI reduces employment opportunities or creates entirely new kinds of higher value work? Many believe there will be newer kinds of work available.

“As AI changes global business operations, GCCs will take on more responsibility for advanced product development, data science, AI engineering and innovation. If so, then access to specialised talent may be even more important than it is now,” Bhaskarwar says. And that could build on existing ecosystems like Bengaluru.

The Real Winners

In the battle of states, it won’t be the ones who have the best incentives or those that get the most approvals in the shortest time. They will be the states that succeed in creating an environment where global companies can get talent, innovation, research capabilities, leadership, and entrepreneurial energy all in one place. That’s what Bengaluru has done in the last 40 years, says Prasad.

The challengers are definitely making ground. Hyderabad is growing. Chennai is tapping its engineering depth. Pune keeps attracting sophisticated engineering and financial operations. New destinations are appearing almost every year. But the real test is not whether they can attract the next GCC announcement. It is whether they can build the next Bengaluru. 

Karnataka is still India’s GCC capital. But the rest of the country has also entered the fray.