FM Sitharaman, CEA urge GCCs to move up the value chain as AI threat looms
New Delhi, Jul 10, 2026
Nirmala Sitharaman urged GCCs to move up the value chain, while the CEA warned AI could erode India's cost advantage if firms fail to innovate
Finance minister Nirmala Sitharaman on Thursday urged global capability centres (GCCs) to move up the value chain while chief economic adviser (CEA) V Anantha Nageswaran cautioned that artificial intelligence (AI) can be a threat to such centres that are focussing on low-cost and repetitive work.
Addressing the Confederation of Indian Industry (CII) GCC Business Summit 2026, Sitharaman asked GCCs to continue moving decisively up the value chain, create intellectual property, lead frontier research, develop AI applications, own product architecture and drive global innovation.
CEA Nageswaran warned against complacency, saying India's current advantage could erode as competing countries replicate its GCC model and domestic costs continue to rise. “A country that treats a powerful technology (AI) as fate will be shaped by it. A country that treats it as a tool will shape it instead. India must be firmly in the second group,” he said.
Sitharaman said the target of establishing 5,000 GCCs by 2030 was “realistic and achievable”, pointing to a large pool of global companies that have yet to establish capability centres in India.
“Around two-thirds of the Fortune Global 2000 companies have yet to establish a global capability centre in India. This is one of the largest untapped investment opportunities before us,” she said.
India currently hosts more than 2,100 GCCs, employing 2.3 million professionals and generating nearly $100 billion in annual revenues, according to figures cited by Sitharaman. More than 500 Forbes Global 2000 companies have established GCCs in the country. India now accounts for over 50 per cent of the world’s GCCs, she said.
Highlighting the acceleration in investment, Sitharaman said while one new GCC was set up in India every week in 2024, the current pace had increased to an average of one new centre every day.
The nature of such investments was also changing, she said, with more than half of new GCCs now being “AI-first”, Sitharaman said.
“India’s value proposition has evolved from cost efficiency to capability leadership,” Sitharaman said.
She added that the next decade should be defined not merely by the number of centres but by a rising share of global “ideas, patents, products, algorithms, platforms and enterprise capabilities” being conceived, engineered and led from India.
The finance minister also signalled a push to spread GCC investments beyond established hubs such as Bengaluru, Hyderabad and Gurugram. If the first 2,000 centres were concentrated in metropolitan areas, the next wave would be “geographically far more diverse”, she said, naming Varanasi, Chandigarh, Visakhapatnam, Tiruchirappalli and Mysuru as potential innovation centres.
At least 10 states have either announced or are developing dedicated GCC policies, Sitharaman said. She argued that states should avoid replicating each other and, instead, build specialised ecosystems around their respective competitive strengths.
The next phase of expansion also offered opportunities to attract companies from East and West Asia, Eastern Europe, the Nordic countries and Australasia, she said.
“India’s GCC journey is much larger than the story of one successful sector,” Sitharaman said. “It is about making India indispensable to the world’s knowledge economy.”
While both Sitharaman and CEA highlighted the recent measures taken by the government to provide tax certainty to GCCs, the CEA cautioned that government support alone would not sustain India's competitive edge. "Government can build the runway. It cannot fly the plane," Nageswaran said, adding that India continues to face a significant employability challenge despite producing a large number of graduates every year.
[The Business Standard]
