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India’s Global Capability Centres (GCCs) sector is entering a new phase. While major cities such as Bengaluru, Hyderabad, and Pune remain dominant, a growing number of companies are exploring smaller cities for expansion.

According to NASSCOM-Zinnov’s “The GCC Value Orbit” report published in May 2026, there has been a 32% growth in the number of GCCs established in the country since FY21. While two-thirds of new GCCs in the past two years have primarily chosen tier-1 cities, emerging hubs are gaining fast traction.

The Confederation of Indian Industry’s 2025 GCC report highlighted that between FY19 and FY24, ~6% of all new GCCs were launched in tier-2 and tier-3 cities, such as Ahmedabad, Coimbatore, and Kochi. Industry reports attribute this expansion to the growing strategic and economic advantages offered by emerging tier-2 and tier-3 hubs.

The NASSCOM-Zinnov report projected that GCC real estate in India will grow from 263+ million to 350+ million sq. feet over the next 3-4 years. However, Bootmind’s report highlighted that the bulk concentration of GCCs in tier-1 cities has resulted in saturation signals, such as salary inflation, attrition spikes, and real-estate cost compression. Meanwhile, tier-2 hubs offer a 30-40% cost index advantage over a primary tier-1 hub like Bengaluru.

This becomes a crucial aspect for mid-market GCCs, which operate at a lower level with minimal budget. Additionally, tier-2 hubs like Coimbatore, Hosur, Visakhapatnam, Indore, Goa, and Lucknow have active IT/ITeS policies that provide corporations with significant benefits to establish GCC hubs. These cities offer 10-25% fixed-capital investments, full or 50% stamp-duty exemption, electricity tariff rebate, SGST reimbursement, payroll subsidy, and lease/rent reimbursement.

Furthermore, 90-95% of leading GCCs partner with universities to build internship and hiring pipelines, and companies are increasingly looking beyond traditional metro hubs to access talent early. With over 60% of Indian graduates skilled in AI, automation, and digital engineering emerging from non-metro cities, establishing GCCs in tier-2 and tier-3 locations becomes ideal for organisations to tap into these talent pools directly, while also reducing relocation costs associated with moving fresh graduates to tier-1 cities.

The outcome of this would not be corporations completely moving their GCC hubs to tier-2 and tier-3 cities in the near future, as roles such as AI/ML R&D, deep-tech require a strong tier-1 ecosystem to function effectively. However, what most likely will happen is big organisations following the hub-and-spoke model by setting up their main GCC hub in tier-1 cities for deep-tech, production engineering roles, while setting up satellite hubs in tier-2 and tier-3 cities for engineering services, finance & accounting BPM, and customer support functions. This helps organisations balance depth with distribution by establishing mid-sized enterprises with focused mandates from inception.

As GCCs evolve from support centers into strategic innovation hubs, their presence in smaller cities could reshape local employment markets and strengthen regional technology ecosystems. For India, this shift could mark the beginning of a more distributed GCC landscape, and through the emergence of technical hubs in emerging cities, it might boost the growth of emerging hubs in a significant way.