Over the past decade, India’s technology ecosystem has entered a new phase of maturity, driven by the rapid growth of global capability centres (GCCs).
However, the competition between MNCs and Indian IT companies over the last 25 years is now being defined as a threat to Indian IT in terms of resources.
In its 2024 annual report, Cognizant, for example, flagged the potential risks stemming from GCCs operated by its clients. The concern is that these centres could overshadow the outsourcing work that the Indian IT firms do in India.
But how much of this threat actually holds true?
Deepak Tiwari, director – GCC sales & client leadership, Accenture, mentioned in a LinkedIn post that one of the key challenges GCCs face is the resource-intensive nature of building technology centres of excellence (CoEs) for every emerging technology.
Whether it’s AI, cloud, or cybersecurity, setting up dedicated in-house expertise for each domain demands significant time, investment, and talent. This is where IT services companies step in as critical enablers.
“GCCs are not a threat to Indian IT, they’re a natural next step in India’s technology evolution,” Pratik Nath, managing director, Epsilon India, told AIM.
He mentioned that traditional IT services put India on the global map by delivering scale, cost efficiency, and execution excellence across industries. GCCs build on that foundation, shifting the focus from delivery to ownership and from supporting business strategies to helping shape them.
“At Epsilon India, for instance, our mandate goes beyond engineering. We co-own product roadmaps, manage data platforms, and solve business problems end-to-end. That level of integration requires different capabilities, but it doesn’t displace what IT services offer. Instead, it pushes the ecosystem forward,” Nath added.
Collaboration, Not Cannibalisation
According to internal data from ANSR, a leading GCC enabler, 85% of GCCs established through them in India actively work with Indian IT service providers. They often rely on them for legacy systems, specialised support, or platform scalability while retaining core innovation functions in-house.
Talking to AIM, Bharat Raizada, head of the chief technology office, Wells Fargo India and the Philippines region, stated that this evolving dynamic is already playing out on the ground.
“The ecosystem is maturing,” he explained. “IT firms scale with outsourcing, and GCCs scale with insourcing; both serve different business needs.”
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Raizada further inferred that this maturity is also reflected in business performance. GCCs added $64.6 billion to India’s tech sector in FY24, and are projected to reach $100 billion by 2030, showing that growth is accelerating for both models.
The Talent Puzzle
One of the most debated aspects of this shift is the talent movement. With GCCs offering premium pay, global roles, and high-impact projects, there is concern among some quarters that Indian IT services firms are losing out.
But this view oversimplifies a complex transformation.“Yes, GCCs are drawing top-tier talent—and that’s a good thing for India’s tech talent pool,” Raizada added.
“To look at it from the lens of poaching is to miss the big picture – it’s about pushing the bar,” he added.
The competition for digital talent is real, and it’s driving the entire ecosystem to upskill faster. With GCCs expected to employ ~4.5 million people by 2030, the focus now is on expanding the talent pool, not just competing for it. Most GCCs are already investing in reskilling, upskilling and academic partnerships. This isn’t talent drain, it’s capability-building at scale.
On the other hand, Nitesh Mirchandani, chief business officer at Mindsprint, told AIM, “It’s true that GCCs are hiring aggressively. But the bigger story is that AI is fundamentally changing the rules of the talent game.”
“It’s no longer about how many engineers you can hire — it’s about how fast you can re-skill your teams, re-architect your operations, and use AI to amplify human potential. Organisations that miss this shift, whether GCCs or IT firms, won’t just lose talent — they’ll lose relevance.”
Furthermore, Nath mentioned that “Our engineers aren’t building to spec alone, they’re solving for customer experience, data privacy, and personalisation at scale.”
Engineers in IT services firms typically work across a range of industries and technologies, which broadens their perspective and equips them with cross-functional insights.
Neeti Sharma, CEO of TeamLease Digital, pointed out to AIM that once, the trend was essentially a movement from IT services firms to GCCs. Now, the competition has intensified within the GCC ecosystem itself.
Converging Capabilities
“It’s not about either/or—it’s about working together,” Tiwari added. “GCCs innovate, and IT services ensure that innovation is delivered with speed, scale, and sustainability.”
As GCCs scale rapidly, especially among mid-market players, many are hitting operational roadblocks. While they excel in domain expertise and innovation goals, execution remains a challenge.
“India’s GCC story isn’t about competition with IT services — it’s about convergence,” Mirchandani mentioned.
“Mid-market players are driving GCC expansion, and their ambition is clear: move beyond execution to innovation. But many GCCs still face operational inefficiencies and struggle to build strong innovation ecosystems. They cannot afford to do it alone,” he further added.
Rather than reinventing the wheel internally, forward-looking GCCs are partnering with IT services firms for high-end delivery, AI-led operations, and platform-driven orchestration.
“GCCs that try to replicate everything internally will face steep costs and slow outcomes,” Mirchandani stated.
As a matter of fact, together, they are helping position India not just as the back office of the world, but as the brain trust for global digital transformation
The post GCCs and Indian IT Spell Convergence, Not Competition appeared first on Analytics India Magazine.
