Tax incentives could be the missing catalyst to push India’s GCCs up the innovation value chain

For more than two decades, GCCs have been one of India’s most durable economic success stories. From finance and HR to advanced engineering, analytics, and AI, GCCs today employ close to 2 million professionals and contribute billions of dollars in exports. Yet, even as the nature of work executed from India has grown dramatically in complexity and strategic importance, the country’s tax framework has not kept pace.

Without policy recalibration, experts warn that India risks locking its GCC ecosystem into a cost-optimisation model, just as global enterprises are deciding where innovation ownership, product mandates, and IP will reside over the next decade.

At the heart of the issue lies a structural contradiction. Innovation carried out within GCCs, spanning advanced R&D, AI platforms, high-performance computing (HPC), digital twins, semiconductor design, and global product engineering, is still largely taxed as routine operational expenditure. A dollar spent on ...