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India’s Global Capability Centre (GCC) boom is entering a new phase. After years of concentrating on scale and cost advantages in major hubs like Bengaluru and Hyderabad, companies are increasingly looking beyond the Tier-1 metros. Factors such as availability of talent, lower operating costs and improving infrastructure are driving the growth.

This shift is significant because emerging cities are now seen as specialised hubs for innovation, digital transformation and niche technology capabilities, rather than as secondary delivery locations.

According to a report by ANSR, enterprises are adopting distributed operating models where emerging cities serve as “specialised capability nodes” in areas such as cybersecurity, AI operations, analytics, test engineering and digital risk. This marks a major evolution in the GCC model.

This transformation is driven by changes in enterprise work. The rise of AI, automation and low-code platforms has reduced reliance on large workforce clusters. Organisations now prioritise smaller, high-impact teams with deep domain expertise and cross-functional business understanding. The report calls this the rise of “T-shaped talent”—professionals who combine specialised technical skills with broader strategic knowledge.

This new talent model aligns well with Tier-2 cities. Unlike earlier strategies that required large, centralised teams, companies can now build agile teams of 50–100 specialists in emerging hubs without sacrificing quality or scalability.

Workforce sustainability is another key factor. Tier-1 cities face talent saturation, rising costs and high attrition, while emerging cities offer access to underutilised talent, lower turnover and better social infrastructure. For many global organisations, this supports a more resilient long-term operating environment.

As highlighted in The GCC Hub coverage on Tier-2 GCC expansion, cities such as Coimbatore, Indore, Kochi, Mysuru and Ahmedabad are attracting global attention for their talent ecosystems, educational institutions and improving infrastructure readiness.

The emerging city narrative now centres on strategic diversification, not just decentralisation. GCCs are adopting a “hub-plus-one” approach, with Tier-1 metros as anchor locations and Tier-2 cities providing specialised, future-focused capabilities to strengthen enterprise resilience.

India’s next GCC chapter will not be defined by its largest cities alone, but by how effectively organisations build distributed networks of innovation across the country’s emerging urban centres.