Iran conflict slows GCC expansion in India amid global risks
NEW DELHI, INDIA — The escalating Iran conflict and mounting global geopolitical risks are slowing the pace of new global capability center (GCC) openings in India, as multinational corporations reassess their expansion strategies in one of the world’s most active technology hubs.
According to a report from The Economic Times, a total of 63 GCCs opened in the March quarter, down from 74 during the same period a year earlier as cited by the report from UnearthIQ, part of market researcher UnearthInsight.
While the number of companies setting up greenfield GCCs rose to 28 from 24, project discussions have tapered off since the start of the Iran war.
Macro uncertainty weighs on brownfield growth
Existing GCCs are holding back on expansion as geopolitical tensions mount.
“Macro uncertainty pushed existing GCCs to hold back on expansion,” said Gaurav Vasu, founder at UnearthInsight, noting brownfield activity dropped 30% in the first quarter of 2026.
He added that if geopolitical pressures ease, greenfield GCCs could reach roughly 100 in 2026, nearly unchanged from the previous year.
The broader ecosystem, however, continues to grow in value. TeamLease Digital projects annual GCC growth of 18% to 22%, while industry estimates suggest revenues likely crossed US$80 billion in the last fiscal year — up from Nasscom’s $64.6 billion figure for FY24. By contrast, the overall information technology (IT) industry is forecast to expand just 6% in FY26.
Dual structure reshapes India’s tech landscape
The GCC boom is reshaping, rather than displacing, India’s IT services sector.
“GCCs are creating new demand and also taking share from IT service providers,” said Pareekh Jain, CEO at EIIR Trends.
Roughly 30% to 50% of GCC work would previously have gone to IT vendors, but 40% to 60% of current GCC growth stems from new capabilities in artificial intelligence (AI), product engineering, and digital platforms — work that was never part of the traditional outsourcing market.
Contracts are also flowing back to vendors. Wipro acquired Olam’s GCC, Infosys acquired Danske Bank’s, HCLTech took over HPE Communication Group, and Virtusa acquired Wiley’s GCC, Jain noted, describing the pattern as a cyclical shift between in-house and third-party models.
For India’s outsourcing industry, the current slowdown reflects a maturing market where cost arbitrage no longer defines competitive advantage.
As insourcing and outsourcing increasingly coexist, IT service providers are repositioning around speed, specialised capabilities, and deeper client partnerships — a shift that, despite near-term geopolitical headwinds, could ultimately strengthen the sector’s long-term relevance.
