India’s Karnataka plans 500 new GCCs, $50Bn economic boost by 2029
KARNATAKA, INDIA — Karnataka is set to aggressively expand its global capability center (GCC) ecosystem, aiming to establish 500 new GCCs by 2029, a move expected to generate nearly US$50 billion in economic output and create about 3.5 lakh (350,000) jobs.
According to a report from Analytics India Magazine, the announcement was made by Chief Minister Siddaramaiah while presenting India’s State Budget 2026.
Decentralizing India’s tech sector: New IT park in Mangaluru
The state currently hosts 550 GCCs, and the government’s push is part of a broader strategy to decentralize India’s IT sector beyond Bengaluru, traditionally the nation’s technology hub.
To support this vision, an IT park will be developed in Mangaluru through the Karnataka State Electronics Development Corporation (KEONICS), designed to attract global companies and promote GCC development.
“Similar efforts in Mysuru have already shown results, with over 30,000 employees currently working across nearly 100 IT companies in the city due to sustained encouragement for the information technology sector,” Siddaramaiah noted, highlighting the potential for Tier-2 and Tier-3 cities to emerge as significant IT centers.
The state is also witnessing the rise of ‘nano GCCs,’ agile, innovation-led centers often based in smaller cities, which complement the growth of larger captive centers.
These nano GCCs are expected to drive experimentation and innovation, providing smaller companies with the flexibility to adapt quickly to global business demands.
Medium-sized enterprises, which now account for nearly 50% of India’s total GCC landscape, are increasingly establishing their own centers, bridging the gap for firms without extensive in-house R&D operations.
Mysuru emerging as India’s next startup laboratory
The government’s decentralization efforts coincide with a proposal from former Indian Space Research Organization (ISRO) Chairman Sreedhara Panicker Somanath to develop Mysuru as India’s “startup laboratory.”
“Let Mysuru be a place where startups co-create with labs, where internships matter as much as examinations and where technology policy is informed by evidence, ethics and empathy,” he said during the 106th convocation of the University of Mysore.
Karnataka’s strategy represents job creation, innovation, and regional economic development to protect technology advancement from being restricted to urban centers.
The state’s business strategies follow international patterns as companies now prefer to establish operations in Tier-2 and Tier-3 locations that help them find skilled workers and reduce operational costs.
By supporting nano GCCs and mid-sized enterprise centers, Karnataka aims to cement its status as a global IT service hub—creating a viable business blueprint that other Indian states can replicate to achieve technology-based economic development.
