India’s Tier-2 Cities Emerge as Key Drivers of GCC Growth
With a 25% lower cost base, 20–30% lower attrition, and growing STEM talent, tier-2 cities enable faster organisational scaling while promoting inclusive economic growth.
India’s Tier-2 cities are rapidly becoming the next growth frontier for Global Capability Centres (GCCs), according to InCommon’s GCC Tier 2 Report 2025. The report highlights a significant shift, with Tier-2 cities increasing their share of the total GCC count from 5% in 2019 to 7% in 2025.
With over 1,700 active GCCs in India, more than 170 are strategically located across 18 Tier-2 cities, including Ahmedabad, Kochi, Jaipur, Mysuru and Bhubaneswar. These cities are emerging as powerful growth engines, driven by expanding talent pools, lower costs and strong policy support.
Crucially, Tier-2 hubs are not just absorbing low-end operations; they are increasingly hosting high-value, technology-driven GCCs. These centres focus on critical areas such as AI and data engineering, software and platform development, product R&D, cloud services, and cybersecurity.
“The Tier-2 hubs are no longer secondary options as they are emerging as core innovation ecosystems for digital engineering and R&D,” said Piyush Kedia, Co-founder and CEO of InCommon. “With a 25% lower cost base, 20-30% lower attrition and a rapidly expanding STEM talent pool, these cities are enabling organisations to scale faster while driving inclusive economic growth.”
The report highlights distinct regional strengths, reinforcing the value proposition of these locations. Bhubaneswar and Vadodara are establishing themselves as semiconductor and R&D hubs, while Kochi and Warangal are specializing in digital, cloud and fintech engineering. Coimbatore, Indore and Ahmedabad are consolidating their positions as multi-sector innovation clusters, supported by strong academic linkages.
The InCommon GCC Tier 2 Report 2025 says that India’s Tier-2 cities are successfully following the Tier-1 growth trajectory. With stronger policy backing and lessons learned from the first wave of expansion, this evolution is shaping a more balanced, resilient and regionally inclusive GCC landscape set to define the next decade of India’s enterprise transformation and global enterprise expansion.
