The Karnataka (GoK) government has announced its target to attract 500 new Global Capability Centres (GCCs) by 2029 to create 3.5 lakh jobs and drive $50 billion in economic output. This will take the total number of GCCs in the State to over 1,000.

According to the GCC Policy 2024-2029, launched on Friday, India is home to over 1,700 GCCs, employing more than 19 lakh people. While the Indian GCC market size is $64.6 billion, at $22.2 billion, Karnataka is a significant contributor. The State currently employs over 6 lakh people across GCCs.

India’s first policy for GCCs

Unveiling the policy report at an event, Priyank Kharge, Minister for IT BT and RDPR, said, “We proudly launch India’s first dedicated policy for GCCs, reaffirming Karnataka’s position as the top destination for innovation and business transformation. GCCs have evolved from back-office operations to becoming critical drivers of global strategic initiatives, R&D, and technology solutions. Contributing $22.2 billion to the economy, GCCs have been a vital source of growth and employment for Karnataka.”

He added that through this policy, the GCC sector is expected to grow at a compound annual rate of 12-14 per cent over the next decade, and foresees Karnataka holding nearly 50 per cent of the national GCC market share by 2029.

According to the report, GCCs have significantly transformed the country’s economic landscape. GCCs in India grew at around 9.8 per cent between FY2019 and FY2024. The role of the engineering, research, and development (ER&D) sector has been pivotal in this growth, with ER&D GCCs accounting for more than half of this revenue, at $36.4 billion. Projections suggest a headcount exceeding 25 lakh by 2030, and a market size exceeding $100 billion.

Incentives on the cards

Under the Talent Pillar, the policy aims to facilitate internships for up to 1 lakh individuals in leading GCCs and has committed a ₹100 crore Innovation Fund to support joint research projects between academia and GCCs.

The State government announced a few incentives to promote this growth. For any new or existing GCC in the State with a minimum of 100 employees engaging in talent creation, the government will reimburse 20 per cent of the total expense spent on the skilling initiative up to ₹36,000 per graduate and ₹18,000 per diploma holder for up to 100 employees, or 15 per cent of their total workforce. These can be technical skilling initiatives for non-tech employees or soft-skill enhancement initiatives for employees in tech and non-tech roles.

For govt institutions

For any new or existing GCC in the State, hiring interns from State government universities or affiliated colleges will attract reimbursement of 50 per cent of the internship stipend for interns, for up to 3 months, and up to ₹5,000 per month per intern, for a maximum of 20,000 interns per year, and 1,00,000 interns over the policy period.

The policy has also indicated the establishment of Global Innovation Districts, with three new state-of-the-art technology parks—one in Bengaluru and two in “Beyond Bengaluru” clusters. These parks will feature cutting-edge infrastructure to enable collaboration between start-ups, tech leaders, and academia. Anchor investors in these districts will receive special incentives, with mega projects eligible for customised packages.

Centre of Excellence for AI

To support AI research, the government will establish a Centre of Excellence (CoE) for AI in Bengaluru, operating through a hub-and-spoke model across academic institutions. An AI Skilling Council with industry participation will also be launched.

A dedicated GCC support unit within the Department of Electronics, IT, Bt, and S&T will be established to serve as a Single Point of Contact (SPOC) for GCCs. This unit will facilitate coordination with government departments, fast-track approvals, and provide real estate scouting support.

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