Introduction

Global Capability Centers (GCCs) are the lifeblood of multinational corporations, fostering innovation and driving operational excellence. With its vast talent pool and robust infrastructure, India has become a prime destination for GCC establishment. 

However, established metros are only one of the games in town. Tier-II cities rapidly emerge as contenders, offering a compelling value proposition for forward-thinking organizations.

Evaluation Criteria for Emerging GCC Cities

To identify the most promising GCC destinations, we consider several key factors:

• Talent Availability & Quality: A deep pool of skilled professionals across diverse disciplines is crucial.
• Cost Competitiveness: Favorable office space costs, operational expenses, and talent acquisition costs.
• Infrastructure: Robust connectivity (physical & digital), reliable power supply, and quality business ecosystems.
• Government Support: Proactive government policies, ease of doing business, and talent development initiatives.‍
• Quality of Life: A vibrant city environment that attracts and retains top talent.

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Top 5 Emerging Cities for GCCs

Ahmedabad: A High-Potential Hub for Next-Gen GCCs

• Population: 8.4 million
• Adult literacy: 88.16 %
• Languages spoken: Gujarati, Hindi, English
• Experienced talent available: 90,000–95,000
• Avg. investment in leading start-ups: US$ 300 million
• Incubators for start-ups: 30+
• Tech-related businesses: ~3,700
• Area under GIFT City Special Economic Zone: 4 sq. km.

Talent Availability

• The city has an experienced talent pool of ~95,000 working in the technology industry.
• Highly qualified coders and developers, and finance/ commerce graduates are available for technology services. Advanced skills such as robotics, machine learning, data science, and DevOps are present to a limited extent.
• More than 500 colleges, of which 80 percent offer specialization in commerce, management, and arts, are conducive to the technology industry.
• ~75,000 students graduate every year, but most of them migrate to other locations because of limited opportunities.
• Colleges such as the Indian Institute of Management Ahmedabad, St. Xavier’s College, and the National Institute of Pharmaceutical Education and Research, Ahmedabad provide high-quality talent.

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• Gujarat International Finance & Technology (GIFT) City, India’s first international finance service center, has been developed on ~900 acres of land consisting of an SEZ and an exclusive domestic area.
• GIFT City is expected to create ~600,000 jobs directly and indirectly in finance, IT, commodity trading, and other functions.
• ~130 sq. km. area of the industrial zone is developed by the Ahmedabad Urban Development Authority.
• It is well connected to other Indian cities through road, rail, and air transport. Intra-city metro connectivity is developing.
• The city offers attractive real estate options at approximately 30 percent of the cost compared with mature locations
• Office rental (Grade A office space): INR 40–45/sq.ft./month

Technology Ecosystem

• Traditionally a manufacturing and trading hub, Ahmedabad has seen rapid industrialization in the past two decades (since the early 2000s).
• Home to many technology companies, Ahmedabad is proving to be a promising location for technology and allied services.
• Ahmedabad is an emerging start-up ecosystem for the BFSI, pharmaceutical, and agriculture-based industries, and internet start-ups (accounting for 40 percent of the start-up ecosystem).
• It is a hub for the fintech, pharmaceutical, and allied industries.

Risk and Regulatory Environment

• In terms of crime, Ahmedabad scores well and is considered a very safe city to live in.
• Due to the government’s efforts to improve infrastructure and promote local businesses, Ahmedabad scores very high in the EODB ranking (2/37).
• Developed space/SEZ:  ~2.4 sq. km. 
• Seismic zone: 3 (Moderate)
• Probability of flooding: Medium 
• Power disruption risk: Low

Social and Living Environment Ahmedabad, a bustling metropolis in Gujarat, offers a diverse social and living environment with a robust education and medical ecosystem, low cost of living, and low crime index.

• The city has ~ 4,381 schools and ~ 945 hospitals catering to the population’s needs.
• The cost of living index, at 24.42, is 5 percent lower than other IT hubs, offering an affordable yet high-quality standard of living.
• However, the pollution index at 55.90 is moderate, but the city is taking steps to address the issue and maintain a healthy living environment for its citizens.

What does the future look like? The city has the potential to extend its reach towards fulfilling the requirements of procurement and logistics functions, specifically for the manufacturing industries located in the Surat–Vadodara–Ahmedabad corridor. Ahmedabad, as a hub for manufacturing and host to distinguished institutions such as the Physical Research Laboratory and ATIRA, can emerge as a prominent center for material technology research. This could facilitate the advancement of ER&D and innovation in this domain.

Bhubaneshwar: Powering Innovation from the East Coast

• Population: 1.22 million
• Adult literacy: 93.15 %
• Languages spoken: Odia, Hindi, English, Bengali
• Experienced talent availability: 60,000–65,000 
• Developing a strong start-up ecosystem: Top performer
• Tech-related businesses: 200 

‍Talent Availability

• About 65,000 experienced talent are recruited in the technology sector.
• About 96 percent of the workforce is employed in the service sector, where technology forms a major part.
• It has the lowest unemployment rates amongst tier 2 locations. According to the CMIE report, it stands at 1.47 percent in the last quarter of FY 2021–2022.
• Skilled personnel suitable for the technology industry usually migrate to cities such as Bengaluru and Hyderabad in search of higher-paying jobs.
• Premier institutes, such as Kalinga University, IIT Bhubaneshwar, C.V. Raman Global University, and other tier 2 institutes, ensure a supply of ~49,000 fresh graduates per year.

Infrastructure Attractiveness

• The state government plans to create a land bank of 1 lakh acres by the year 2025–2026 to avoid local resistance against land acquisition.
• The government has fostered growth through several IT parks, such as Infocity-1, InfoValley, STPI, and JSS STP, and state-of-the-art infrastructure facilities equipped with plug-and-play facilities and abundant power supply to ensure smooth operation of the IT sector.
• Ministry of Electronics and IT (MEITY) launched the Next-Generation Incubation Scheme, Virtual and Augmented Centre of Entrepreneurship (VARCoE), and Electropreneur Park in Bhubaneshwar. Its Export Promotion Industrial Parks scheme provides special incentives and facilitates for setting up of IT parks and zones.
• An international airport is being developed and is expected to be operational by the year 2023.
• Office rental (Grade A office space): INR 60–80/sq.ft./month

‍Technology Ecosystem

• Industries supporting the economy range from agriculture, horticulture, engineering, and agriculture-based industries to IT-enabled services, handloom, and tourism.
• The technology sector forms a major part of the service industry.
• Home to ~200 technology set-ups in various categories; of them, First Source, a major Indian IT set-up, is based in Bhubaneshwar.
• Bhubaneshwar has constantly recorded double-digit growth in software exports since the year 2012–2013.
• Start-ups are dominated by technology, enterprise software, e-commerce, healthcare technology, and other technology-allied services.
• Start-up Bhubaneswar is Odisha’s premier and definitive online platform aimed at helping aspiring entrepreneurs and budding innovators

Risk and Regulatory Environment :

Bhubaneshwar lies in Seismic Zone 3 with a moderate risk of earthquakes but a high risk of torrential cyclones every monsoon.

• Rank in EODB:  11/37 (Moderate)
• Developed space/SEZ:  ~2.03 sq.km. 
• Probability of flooding: Medium 
• Power disruption risk:  Low

‍Social and Living Environment

• The city has a thriving education ecosystem, with more than 2,500 schools catering to the diverse needs of the student population. The quality of education is exemplary, and schools are well-equipped with modern facilities to provide a conducive learning environment.
• Furthermore, the city has a robust medical ecosystem, with ~71 hospitals providing quality medical care to citizens. Hospitals are equipped with state-of-the-art facilities and staffed by highly qualified and skilled medical professionals.
• The city also boasts of a relatively low cost of living index of 20.56 (~20 percent less expensive than other IT hubs).
• The city also has fewer instances of crime and moderate pollution levels.

‍What does the future look like? Although Bhubaneshwar is a relatively discreet player in the tech domain, it is soon poised for significant growth due to its service industry, including the tech sector, which employs nearly 96 percent of the total working population. The city is home to a dominant cluster of ESDM industries, which, along with prestigious institutions, such as the Institute of Life Sciences, Bhubaneswar, Regional Medical Research Centre, Regional Plant Resource Centre, and National Institute of Science Education and Research, places it in a promising position to emerge as a leading biotechnology hub in the future.

Jaipur: Where Heritage Meets High-Tech

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• Population: 4.1 Mn
• Adult literacy: 83.33%
• Languages spoken: Hindi, Marwadi, English
• Experienced talent availability: 95,000 
• SEZ, Mahindra World City: ~30 sq. km. 
• 2 Unicorns: DealShare & CarDekho
• Tech-related businesses: ~1,000 

‍Talent availability

• The availability of a highly skilled talent pool of approximately 95,000 individuals is facilitated by various technology-oriented establishments in the city.
• Proficiency in the English language, a crucial requirement within the BPM sector, is also relatively high due to the proximity and influence of major metropolitan areas such as the Delhi-NCR.
• Historically, the conventional technology industry has primarily recruited technology and management graduates and individuals with expertise in finance and communications. However, the emergence of technology start-ups, e-commerce, education technology, and finance technology start-ups has expanded the pool of potential hires.
• The presence of premier educational institutions and top-tier colleges, such as the Malviya National Institute of Technology, Arya College of Technology, College of Engineering-Manipal University, and Jaipur University, ensures a steady supply of approximately 100,000 fresh graduates to the booming technology sector.
• The establishment of upcoming SEZs and industrial parks will continue to drive the scalability of the technology sector, potentially providing employment opportunities for up to 200,000 individuals over the next five years.

Infrastructure attractiveness

• The Mahindra World City is one of the biggest SEZs in India, which spans over 600 hectares accommodating technology and export-oriented units. Plans are in place to expand it to 3,000 hectares in the next phase.
• Good road connectivity to Delhi-NCR.
• Poor metro connectivity due to suboptimal route and penetration.
• Well connected by air with other cities in India.
• Office rental (Grade A office space): INR 50–60/sq.ft./month

Risk and regulatory environment

• Jaipur is home to both manufacturing and services industries. It is a city with a diversified economy, with tourism, gems and jewelry, metal and mining, and handicrafts being the prominent industries, along with a growing construction sector and small to medium-sized technology companies.
• It has emerged as a spokes for hubs concentrated in the Delhi–Gurugram–Noida–NCR region, providing cost arbitrage and a competent service level. The city also houses a cluster of BPMs and service providers in the healthcare, BFSI, and IT sectors, with a mix of innovative start-ups across sectors, including technology, education technology, and e-commerce.
• With funding from venture capitalists and angel investors, it has also been the foundation for some unicorns and scalable start-ups. Giant corporates such as Google are trying to reach out to start-ups via Start-up School India to integrate knowledge into a structured curriculum and deliver it across a wide footprint.
• With a promotional fund worth US$ 77.3 million, the inauguration of India’s largest start-up incubation center in Jaipur, and the state-wide favorable operational environment, it is preparing to become north India’s newest start-up hub. iStart-Rajasthan, an integrated start-up platform initiated by the Rajasthan government, aims to attract investors and innovators.

Social and living environment

• Jaipur’s social and living environment is characterized by a moderate education ecosystem index.
• The medical ecosystem index is also moderate, indicating a satisfactory level of healthcare facilities and services.
• The cost of living in Jaipur is considered moderate, making it an attractive option for those seeking an affordable yet comfortable lifestyle.
• The crime index is good, which means that the city is relatively safe and secure for its inhabitants. However, the pollution index is low, indicating that air quality in the city is not optimal.

What does the future look like?

‍Jaipur is now just 2.5 hours from Delhi-NCR by road, thanks to the new Delhi–Mumbai expressway.SEZs on the city’s outskirts with good connectivity with the city are set to catalyze a technological revolution. Privately developed SEZs in Jaipur can bring significant advancements and growth to the region, further solidifying its position as a key player in the technology industry.

Comparative Analysis

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Conclusion

India is emerging as a volume + value destination for organizations. These locations can potentially establish themselves as emerging hubs of technological growth and innovation. 

Companies can access good-quality talent at 25–30 percent lower cost than the major centers.

With proper support and resources, these locations can become major hubs of economic growth and development, driving the success of the technology sector in India.