Growth of India capability centres set to rise sharply, says consultant ANSR

By Haripriya Suresh

BENGALURU (Reuters) - Growth in companies setting up global capability centres (GCCs) in India is set to accelerate sharply as it evolves from a low-cost back office location to a high-value innovation hub, said Lalit Ahuja, founder and CEO of consulting group ANSR.

Indian hubs are now doing cutting-edge work ranging from developing dashboard design for luxury cars to helping pharmaceuticals giants with drug discovery, and have diversified into functions beyond tech support, Ahuja said this week.

"We are going to go beyond information technology and the support functions. We'll design cars, we'll design batteries, we'll design engines, we'll design products, we'll design apparel," Ahuja said, whose Accel-backed firm's clients include FedEx and Uber.

Overseas companies have opened 118 GCCs in India over the past two years, taking their total to more than 1,620, February data from industry body Nasscom showed. GCCs are forecast to contribute 2% of India's GDP by 2030, ICICI Securities, from less than 1% at present.

"That opportunity is 10 times the IT opportunity. Think about a company's core business being done out of here. Why should it be restricted to building an e-commerce platform? Anything that does not require a presence in the domestic market can be done anywhere," Ahuja said.

Ahuja played down concerns of job losses due to AI.

"GCCs don't have as many jobs that are going to be impacted by AI compared to the service providers," he said. "It will be used more to make the GCCs more efficient, more impactful (and produce) better quality work," he said.

(Reporting by Haripriya Suresh; Editing by Dhanya Skariachan and Alexander Smith)