Bengaluru dominates chip GCC’s in India with 42% of total units, says report

The city of Bengaluru dominates when it comes to setting up of semiconductor Global Capability Centres (GCCs) in India, according to a report by Nasscom and Zinnov.

Government-led initiatives aimed at fostering indigenous semiconductor production in India have significantly increased investment over the years, the report highlighted.

Often known as the Silicon Valley of India, Bengaluru accounted for about 42 percent of the total GCC units and 61% of GCC talent. This development becomes crucial at a time when information technology (IT) companies are struggling with tepid demand due to macroeconomic uncertainty. In the recent past, GCCs are emerging as a key hiring sector in India.

GCCs, which are dedicated offshore centres set up by a company to in-source IT and other related business functions, have come into the spotlight of late due to their hiring spree.

In total, over 95 GCCs were established in the financial year 2022-23 employing over 50,000 in the country, according to Nasscom and Zinnov’s “India GCC Trends” quarterly analysis.

Trailing Bengaluru is Hyderabad, which accounts for 23 percent of the total GCC units and 21 percent of the talent. Next in line comes the National Capital Region, which accounted for 12 percent of the total GCC units and 7 percent of talent.

Globally, Americas leads with 74 percent of semiconductor GCCs, while Asia Pacific accounts for 10 percent. The rest is held by Europe, Middle East, and Africa.

The report also brings to light that 10 GCCs were set up in the fourth quarter of 2023. This is a decrease from the previous quarter when 18 GCCs set up shops in the country. Hitachi Energy, Sandoz, and DocuSign were some of the companies that set up their captive units.

Semiconductor companies and their GCCs are actively partnering with Indian academic institutions such as the IITs to develop a skilled workforce. For example, Samsung has collaborated with IIT-Delhi to jointly research and develop “device-to-device” communication chip.

Intel has partnered with IIT-Bombay to design complex integrated circuits.

The report also highlights efforts being made by various states such as Gujarat, Odisha, Karnataka, and recently Tamil Nadu to promote GCCs with their policies.