Introduction
India, with its dynamic and skilled youth, has progressively emerged as a global hub for Global Capability Centres (GCCs) established by multinational corporations. GCCs offer numerous strategic advantages, including driving digital transformation, fostering innovation, advancing analytics and technological solutions, promoting research and development, creating employment opportunities, enhancing operational efficiency, and strengthening business resilience. Recognising these benefits, Indian companies are also increasingly adopting the GCC model to fuel their growth. Consequently, several Indian states are crafting policies to attract both domestic and multinational corporations to set up GCCs.
Karnataka led the charge by introducing the first GCC policy, followed by Uttar Pradesh and Tamil Nadu. Meanwhile, Maharashtra and Telangana are in the process of developing their frameworks. Traditionally known for its manufacturing focus, Gujarat has taken a significant step forward by unveiling its own GCC policy, signifying a shift toward services.
Over the past two decades, Gujarat’s consistent alignment between central and state governments has fostered exceptional growth opportunities. The state’s commitment to targeted sectoral development is evident through well-defined policies like the Gujarat IT/ITeS Policy (2022–2027), the Gujarat Semiconductor Policy (2022–2027), the Gujarat Renewable Energy Policy (2023), and the Student Startup and Innovation Policy 2.0.
Global In-House Centres at IFSC, GIFT City
One of Gujarat’s most impactful contributions to the GCC ecosystem is the establishment of Global In-House Centres (GICs) at the International Financial Services Centre (IFSC) within the Gujarat International Finance Tec-City (GIFT City). As India’s first global financial hub, IFSC, GIFT City, is modelled after renowned international financial centres like Singapore, Hong Kong, the Dubai International Financial Centre, and Abu Dhabi Global Markets.
The entities operating within the IFSC are governed by a unified regulatory body—the International Financial Services Centres Authority (IFSCA). The IFSCA integrates the functions of key financial regulators in India, including SEBI, RBI, IRDAI, and PFRDA. Business activities in IFSC, GIFT City, are conducted in freely convertible foreign currencies, with entities (including GICs) classified as non-residents for exchange control purposes.
While GCCs traditionally operate in an unregulated environment, the inclusion of GICs under a light-touch regulatory framework—supervised by the development-focused IFSCA—marks a transformative shift. This approach addresses long-standing concerns about outsourcing to unregulated GCCs and is poised to redefine the financial services landscape.
The IFSCA (Global In-House Centres) Regulations, 2020 (“GIC Regulations”), enable diverse entities—such as banks, NBFCs, investment banks, insurance providers, brokerage firms, and stock exchanges—to establish GICs at IFSC, GIFT City. Applicants must ensure that these GICs exclusively serve entities within their financial services group, regulated by the respective financial authority in their home jurisdiction.[1]
The Gujarat GCC Policy: Features and Significance
The Government of Gujarat (“GOG”), through its Department of Science & Technology (“DST”), has promulgated the Gujarat Global Capability Centre Policy (2025–2030) (“GCC Policy”) on February 11, 2025, with the objective of establishing Gujarat as a premier destination for GCCs. The GOG’s proactive policy approach is in alignment with the Union Budget 2025–2026, which focuses on providing a national framework to guide states for promoting GCCs in emerging tier-II cities of the country.
Through its new GCC Policy, Gujarat offers a strong national and international platform for GCCs and GICs to establish and expand their presence, further strengthening its reputation as a premier GCC hub. GOG, through DST, will issue detailed implementation guidelines to achieve the Policy’s goals and objectives. A State-Level Empowered Committee shall be formed for facilitating the benefits and assistances provided to the eligible GGCs under the Policy.
The Policy aims to foster a thriving GCC ecosystem by promoting high-value investment, infrastructure growth, research and development, generating high-skilled employment opportunities, and ease of doing business. Gujarat’s business friendly ecosystem with a strong focus on sectoral growth through other well-defined policies aim to attract investments by multinational companies, and well complements the Union Government’s vision of making India a global GCC capital. GOG through this Policy envisages generating employment opportunities for the locals by incentivising expenditure, including providing partial reimbursements for employee’s salary, social security contributions paid by employers, and partial reimbursement of fees for professional courses undertaken by working professional and students based in Gujarat. As per the Policy, all eligible GCCs shall also be entitled to claim expenditure incurred on research & development.
With the key focus of the GCC Policy of Gujarat being the promotion of general growth, technology, digital transformation, infrastructure, and employment generation within the State, the Policy defines GCCs as centres that multinational or domestic companies set up to increase the efficacy of their parent organisations and further their strategic goals. These centres are essential hubs for multiple global functions, innovation, and multisector value delivery. These centres cater to different sectors including banking, capital markets, financial services, engineering, research & development, consumer, retail & e-commerce, travel and transportation, technology, media & telecom, automotive, power & utilities, industrial manufacturing, chemicals & materials, and healthcare innovation.
According to the Policy, an “eligible unit” is an existing or new unit established as a GCC with at least 50 employees on its payroll. In terms of the Policy, the eligible units can claim relevant Policy-provided incentives and benefits. However, if for three consecutive months, an eligible unit has less than 50 employees on its payroll, all further fiscal assistance will be discontinued for that particular eligible unit.
The eligible units would be entitled to claim the following expenditures as per the terms of the Policy:
- Eligible CAPEX expenditure: Eligible CAPEX expenditure includes (i)capital expenditure as per Gross Fixed Capital Investment (“GFCI”)[2]; (ii) stamp duty and registration fees paid to the Government for lease/sale/transfer of land and office space; and (iii) renewable energy expenditure.
- Eligible OPEX expenditure: Eligible OPEX expenditure includes expenditure incurred for (i) lease rental; (ii) bandwidth; (iii) cloud rental; (iv) power tariff; and (v) patent.
Interpreting Strategic Incentives and Offering
Basis the amount of investment, the eligible units are entitled to the following fiscal incentives:
Special Incentives and Offerings
The Policy offers additional benefits in the form of reimbursements and subsidies to the eligible units as follows:
Interplay with Gujarat IT/ITes Policy (2022–2027)
In addition to the benefits available to enterprises under the Gujarat IT/ITES Policy (2022–2027) (“IT/ITES Policy”), technology businesses (in a pre-commercialisation stage) are likely to secure a dual benefit in the following manner:
- GCCs providing start-up incubation can claim incentives under the IT/ITES Policy. Specifically, Information & Communication Technology (“ICT”) and Deep Tech Incubators can receive CAPEX support up to 25 per cent of eligible expenditures, capped at INR 25 crore. Such incubators are also eligible for OPEX support up to 15 per cent of lease rental expenditure, 15 per cent of power tariff expenditure, 20 per cent of bandwidth expenditure, and 20 per cent of cloud retail expenditure, capped at INR 10 crore per year for five years.
- GCCs providing acceleration support would be eligible for incentives under the IT/ITES Policy in the form of 10 per cent assistance for investments facilitated through venture capitalists and investors to ICT and deep tech start-ups, capped at INR 10 lakh per ICT and deep tech start-up.
- Further, start-ups receiving incubation or acceleration support from GCCs are also eligible for incentives under the IT/ITES Policy, including (a) research, prototyping, and product development support; (b) patent cost reimbursement; (c) discount on quality certification expenses; (d) infrastructure and cloud costs support; and (e) lease rental support.
Way Forward
Despite being a late entrant to the GCC space, this dedicated Policy is a thoughtful effort to widen the scope to embrace all categories of GCC, highlighting the GOG’s efforts to make Gujarat a top destination for establishing GCCs. This will also aid and be complimentary for the offshore GIC set ups coming up at IFSC, GIFT City.
Through this Policy, the GOG aims to digitalise the entire incentive application and disbursement process to eventually minimise the red-tapism and/or bureaucracy obstacles faced by foreign organisations while navigating the Indian market. We are confident that through this Policy the GOG will encourage investment from many global organisations looking to establish their GCCs in India, especially in GIFT City, and that the State will position itself as a serious competitor to existing GCC hubs such as Karnataka, Maharashtra, Delhi, and Telangana. The presence of R&D centres, incubators, and incubated start-ups offers a multi-faceted benefit, potentially fostering a start-up culture, particularly around GIFT City. This ecosystem could attract R&D in areas such as AI, drones, quantum computing, and chipsets, providing access to crucial resources, especially processing power (graphic cards, chipsets, etc.), vital for the AI race. However, we are of the view that the true impact of the Policy will largely depend on its implementation and its ability to attract global companies to establish operations in Gujarat.
[1] Please see here our earlier articles on Global In House Centre at IFSC, GIFT City (i) GCC Series: Setting-up Global In-house Centres (GICs) in India: Key regulatory considerations | India Corporate Law; and (ii) GICs in IFSC, GIFT City: A Combination to Unlock Value | India Corporate Law.
[2] In terms of the Policy, GFCI is defined as expenditure made in the construction of the building, purchase of the building, computers. software, networking related hardware and other related fixed assets, excluding the cost of land required by the eligible unit.
[3] Gross Fixed Capital Investment (GFCI) is the expenditure incurred in the construction and purchase of the building, computers, software, networking-related hardware and other related fixed assets, excluding the cost of land required by the eligible unit. Note: The expenditure incurred under GFCI towards the construction of new buildings shall be capped at INR 3,000/sq. ft. of built-up area, applicable for a total built-up area computed at 60 sq. ft. of built-up area per employee on the payroll.
[4] Eligible CAPEX Expenditure includes (a) capital expenditure as per Gross Fixed Capital Investment (“GFCI’) made during the operative period and up to two (2) years after the commencement of commercial operations/production; (b) stamp duty and registration fees paid to GoG for lease/sale/transfer of land and office space; and (c) expenditure for purchase of equipment for setting up of captive renewable energy plant.
[5] Eligible OPEX Expenditure includes (a) lease rentals to third party at lower of, actual rental or INR 50 per sq.ft, of built up area for five (5) years from start of commercial operations or in-principle approval, whichever is later: (b) bandwidth expenditure on subscribing or leasing from licensed internet service provider with valid GST number for five (5) years from start of commercial operation or m-principle approval, whichever is later; (c) cloud rental expenditure on subscribing or leasing from cloud service provider with valid GST number for five (5) years from start of commercial operation or in-principle approval, whichever is later; (d) power tariff expenditure on energy units consumed for five (5) years from start of commercial operation or in-principle approval, whichever is later; and (e) patent expenditure of up to INR 10 lakh per patent for every successful application (not more than 10 per year) during the Operative Period for five (5) years from the start of commercial operation or in-principle approval, whichever is later.
