CHENNAI: Information technology industry body National Association of Software and Services Companies (Nasscom) said that Global in-house Centres (GICs) of global companies in India have transformed from cost-arbitrage focussed entities into a key innovation centre for their global enterprises.

Speaking on the side lines of the fifth edition of Nasscom’s two-day GIC Conclave in the city, R Chandrashekhar, president of Nasscom said that MNCs are leveraging their GICs to enable digital transformation by their engagement with local startup ecosystem through accelerator programs. “With GICs rapidly maturing and moving up the value chain, they are all set to playing a pioneering role in providing sustained competitive advantage to their global enterprises,” Chandrashekhar said.

He added that expanding in Tier 2 and 3 locations is one of the key priorities of GICs for the coming fiscal.

Nasscom also announced the launch of Nasscom Germany Council to focus on the interests of German GICs based in India and encourage a conclusive growth for both the nations.

The current GIC landscape in India has over 1,000 GICs, generating 20% of the the IT industry's export revenue and comprising 25% of industry's employees count. As per Nasscom’s study of the GIC landscape, the GIC market has witnessed a double-digit growth in the last five years to reach $19.4 bn at a growth rate of 17%. Total employee strength of GICs has also increased at 14% to reach 745,000. For most of the MNCs, India centre has also emerged as the largest captive centre outside their own headquarters.

In terms of innovation, Nasscom estimates that around 300 firms offer engineering research & development (ER&D) and product development services among GIC’s — particularly in emerging technologies of Internet of Things (IoT), robotics, wearable devices and 3D printing. According to Nasscom, establishment of big data labs to develop the fastest-growing data analytics space is emerging as the focus for these captive IT centres.

Shakti Sagar, chair of Nasscom’s GIC Council said that with advantages of cost competitiveness and quality talent availability, India remains the leading location for new GIC set-ups.

