5 Key Takeaways
- GCCs (Global Capability Centres) are reshaping the Indian IT industry by allowing multinational companies to run their own tech operations in India, reducing reliance on traditional IT outsourcing firms.
- GCCs have grown rapidly, now employing nearly 2 million people and contributing 23% to India’s total IT exports, outpacing the growth of top Indian IT companies.
- The combination of GCCs and AI is amplifying layoffs by automating tasks internally, reducing outsourced work, and attracting top tech talent away from traditional IT firms.
- Indian IT companies were slow to recognize the GCC trend, missing early warning signs and now struggling to adapt as clients seek more direct control over their tech operations.
- To stay relevant, Indian IT firms must reposition as GCC enablers, upskill their workforce for AI-driven roles, and redesign business models to support clients’ in-house tech strategies.
Indian IT Layoffs: Why Global Capability Centres (GCCs) Are a Bigger Threat Than AI
When we hear about layoffs in India’s IT sector, most of us immediately think of Artificial Intelligence (AI) taking over jobs. But there’s another, less talked-about reason that’s shaking up the industry even more: the rise of Global Capability Centres, or GCCs.
What Are GCCs?
GCCs are tech hubs set up by multinational companies (like banks, consumer brands, and tech giants) right here in India. Instead of hiring Indian IT companies like TCS, Infosys, or Wipro to handle their tech needs, these global firms are now building their own teams in India. This means they can control their operations more closely, work better with their teams around the world, and save money in the long run.
In the past, GCCs mostly handled simple back-office tasks like IT support or data entry. But now, they’re taking on advanced work—think AI, cybersecurity, analytics, and research—areas that used to be the bread and butter of Indian IT service companies.
How Big Is This Trend?
GCCs are no longer a small part of the industry. There are now over 1,700 GCCs in India, employing nearly 2 million people. Their revenues have been growing faster than those of the big Indian IT firms, and they now make up almost a quarter of India’s total IT exports. Major companies like UBS, Bank of America, Procter & Gamble, and Citibank are investing heavily in these centres.
Why Are GCCs a Bigger Threat Than AI?
AI is definitely changing the way work is done, especially by automating routine jobs. But GCCs are making an even bigger impact by:
- Automating tasks within their own teams
- Reducing the need to outsource work to Indian IT companies
- Attracting the best tech talent away from traditional IT firms
This double whammy means the old model—where thousands of mid-level coders worked for big IT companies—is disappearing. As a result, we’re seeing more layoffs.
Did Indian IT Companies See This Coming?
There were warning signs as far back as 2015, but most Indian IT firms didn’t take the GCC trend seriously. Now, with remote work and digital transformation speeding things up, GCCs are thriving while traditional IT companies are struggling to keep up.
What’s Next?
For Indian IT companies to stay relevant, they need to:
- Help set up and manage GCCs for global clients
- Train their employees for high-value, AI-driven roles
- Change their business models to suit clients who want more control
In short, while AI is changing the way we work, the real game-changer for Indian IT jobs is the rise of GCCs. The industry must adapt quickly, or risk being left behind.
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