How to Set Up a GCC in India: A Practical Guide for Foreign Companies

If you are researching how to set up a GCC in India, the first thing to understand is that the process is much more than registering an Indian company and hiring a few employees.

A Global Capability Centre can handle technology, finance, analytics, engineering, research, product development, shared services and other global functions. What starts as a small team can eventually become an important part of the parent company's global operations.

India already has a large GCC ecosystem. In FY2026, the country had around 2,117 GCCs across 3,728 units, employing approximately 2.36 million professionals and generating an estimated $98.4 billion in revenue. The ecosystem has grown by 32% since FY2021.

But these numbers do not answer the below questions a foreign company needs to deal with before entering India.

 - What should the Indian centre actually do?
 - Which structure should be used?
 - How much should be budgeted?
 - Which city makes sense?
 - How will the parent company fund the operation?
 - What happens when the Indian entity starts billing its overseas parent?

This guide takes you through the practical GCC setup process in India, from the initial business plan to starting operations.

1. Begin with the business case, not the company registration

Before looking at incorporation documents, decide why you are establishing the GCC.

A technology company may want an India team for software development, cybersecurity, data engineering or AI. A financial services business may need analysts, accounting professionals, risk specialists or technology teams. Another company may want to build a shared services centre for finance, HR or procurement.

These are very different operating models.

The first exercise should therefore be to map out:

 - Functions that will move to India

 - Expected headcount

 - Roles and seniority

 - Reporting structure

 - Technology requirements

 - Expected operating cost

 - Functions that may be added later

This also helps answer an important question: Is India going to be a support location or a long - term global capability hub?

So, when planning how to set up a GCC in India, it is worth looking beyond the first year's headcount.

2. How Much Does It Cost to Set Up a GCC in India?

There is no standard price tag for setting up a GCC. A 25 - person finance centre, a 50 - person engineering team and a 300 - person technology operation will have completely different budgets.

For an initial 50 - person planning model, companies can consider costs across areas such as:

These are planning estimates, not fixed market prices. The final GCC setup cost in India will depend on the functions, employee mix, city and infrastructure requirements.

One point is easy to overlook: incorporation itself is rarely the biggest expense.

For most GCCs, people, office infrastructure and technology will have a much larger impact on the total investment.

3. Decide how much you want to spend on people

For many GCCs, employee compensation becomes the largest recurring cost. Consider two companies with 50 employees each.

One has mostly junior finance and operations professionals. The other has software engineers, data scientists, architects and senior managers.

Their annual payroll will obviously be very different.

Some current industry benchmarks place annual engineer costs in the $25,000  -  $80,000 range. Other published estimates put roles such as AI/ML professionals around $30,000  -  $55,000, full - stack developers around $20,000  -  $40,000 and engineering managers around $45,000 - $75,000 annually.

These numbers are useful for an early business case, but a detailed budget should eventually be built role by role.

Remember to account for more than salary. Employer statutory costs, benefits, recruitment, training, equipment and other employee - related expenses also form part of the real operating cost.

4. Choose the city around your talent requirement

City selection is one of the more visible decisions in the GCC setup process in India, but it should not be based only on which city has the most GCCs.

Bengaluru remains India's largest GCC hub, accounting for more than 29% of GCC units according to 2026 industry data. Hyderabad, Delhi NCR, Mumbai, Chennai and Pune are also established locations for global centres.

The better question is:

Where can you hire the people your GCC actually needs at a sustainable cost?

For example:

• Technology and AI - heavy teams may look closely at cities like Bengaluru or Hyderabad.
• Finance and corporate functions may consider Mumbai or Delhi NCR.
• Engineering - focused operations may evaluate Chennai or Pune.
• A company already operating in India may benefit from choosing a city where it has an existing business ecosystem.

5. Select the right GCC structure in India

Once the business model is clear, the next question is the legal structure.

A foreign company setting up its own GCC will generally need an appropriate Indian structure to employ people, enter local contracts, maintain banking arrangements and manage its Indian operations.

The appropriate structure depends on factors such as:

• Ownership
• Nature of activities
• Foreign investment requirements
• Funding model
• Tax considerations
• Relationship with the overseas parent
• Future expansion plans

This is where GCC registration in India should not be treated as a standalone incorporation exercise.

The company structure should be designed around what the Indian entity is actually going to do.

A structure that works for a small support team may need to be reconsidered if the Indian operation later starts managing intellectual property, taking on additional risks or making important business decisions.

6. Plan how the parent company will fund the Indian operation

After the Indian structure is ready, the parent company overseas needs to fund the GCC.

Starting funds may be required for:

• Employee salaries
• Office rent and deposits
• Technology
• Recruitment
• Professional fees
• Travel
• Other operating expenses

The movement of money between the overseas parent and Indian entity needs to follow the applicable foreign exchange and corporate requirements.

This is why the funding plan should be prepared before large amounts are transferred.

It also helps to establish a clear financial trail from the beginning rather than trying to document transactions retrospectively.

7. Complete the registrations and compliance requirements

Setting up a GCC does not end with incorporation.

Depending on the structure and activities, the company may need to address corporate registrations, tax registrations, foreign exchange requirements, employment - related compliance, accounting, payroll and other statutory obligations.

Let’s say, for an indicative 50 - seat engineering GCC, some industry estimates place the combined legal and compliance layer at around Rs 12 lakh  -  Rs 31 lakh. This may include areas such as incorporation, FEMA - related work, statutory registrations, employment and IP documentation and transfer pricing work.

These figures should be treated as planning benchmarks rather than prescribed government fees.

The actual amount will depend on the company's structure and the scope of professional work required.

8. Decide how the GCC will charge the overseas parent

This is one of the most important financial questions in the GCC set up in India.

The Indian centre may provide software development, finance, analytics, research or other services to its overseas parent.

If the two entities are related parties, the transactions between them may fall under India's transfer pricing rules.

The company therefore needs to focus on:

1.    What services the Indian entity provides

2.    Which costs it incurs

3.    What functions and risks it performs

4.    How the services will be priced

5.    How the arrangement will be documented

For example, a routine service centre may operate using a cost - plus approach where an appropriate markup is applied to relevant costs. But the correct method depends on the actual functions, assets and risks of the entities.

Transfer pricing should therefore be considered while designing the GCC rather than after the first financial year has already ended.

9. Put the parent - GCC relationship in writing

A simple statement that the India team works for headquarters is not enough for an international group.

An intercompany agreement can establish what the Indian entity is responsible for and how the relationship will operate.

Depending on the arrangement, it may address:

• Services to be provided
• Responsibilities of each entity
• Pricing and payment terms
• Intellectual property
• Confidentiality
• Data and information security
• Expense reimbursements
• Employee - related responsibilities
• Termination provisions

The agreement should also match the actual way the business operates.

If the contract describes the Indian entity as a routine service provider but the actual team is independently developing and managing valuable products, the difference can create tax and regulatory questions.

10. Build the GCC in stages rather than rushing to full scale

A foreign company does not necessarily need to start with 100 or 200 employees.

For many businesses, a phased approach can make more sense.

For example:

First stage: 20 - 40 employees

Build the initial leadership team, core functions and operating processes.

Second stage: 50 - 150 employees

Expand the functions that are working well and add specialist teams.

Third stage: 150 - 300+ employees

Move towards larger global responsibilities, specialised teams and potentially new business functions.

The numbers are only illustrative. A company may start with 10 specialists or 100 employees depending on its business model.

The important part is to decide the likely growth path before finalising the initial structure.

11. How long does it take to set up a GCC in India?

The timeline depends on the complexity of the project.

For a relatively straightforward GCC, 12 - 16 weeks can be used as a rough planning window. Some industry guides also place a basic setup around the 12 - week mark. Larger operations involving more employees, specialised infrastructure or complex regulatory requirements can take considerably longer.

A typical project may broadly move like this:

Weeks 1 - 2:
Business model, city, structure and initial planning.

Weeks 3 - 8:
Entity formation, registrations, banking and office planning.

Weeks 6 - 12:
Recruitment, employment documentation, technology and vendor setup.

Weeks 10 - 16:
Onboarding and commencement of operations.

Several of these activities can happen at the same time, so the process does not always follow a straight line.

12. Keep the future size of the GCC in mind

A GCC that begins with 30 employees may look very different after three years.

As the centre expands, the company may need to revisit:

• Office space
• Payroll and employee policies
• Management structure
• Transfer pricing
• Intercompany agreements
• Tax positions
• Intellectual property arrangements
• Data protection
• Internal controls
• Finance and reporting

This is particularly important when the role of the Indian centre changes.

A finance support team may eventually take responsibility for global reporting. A technology team may begin developing and managing a product used worldwide.

The GCC setup process in India should therefore be designed with the company's potential growth in mind rather than only its first - year requirements.

What can go wrong when setting up a GCC?

Several avoidable mistakes can increase the cost or create compliance issues later.

Choosing the city too early

Do not choose an office location before understanding the talent you need.

Looking only at salary

A lower salary does not automatically mean a lower operating cost. Recruitment, attrition, benefits, office space and infrastructure also matter.

Treating transfer pricing as an afterthought

The pricing arrangement should reflect the actual functions and responsibilities of the Indian entity from the beginning.

Copying another company's structure

Two GCCs with the same number of employees can have completely different legal, tax and operational requirements.

Building only for today's headcount

If the plan is to grow from 30 employees to 300, the initial structure should leave room for that expansion.

A practical starting budget for a 50 - person GCC

If you are preparing an initial business case, the following figures can provide a starting framework:

• $500,000 - $800,000: broad initial setup planning range for a 50 - person GCC
• $25,000 - $80,000: broad annual cost benchmark per engineer
• Rs 12 lakh - Rs 31 lakh: indicative legal and compliance planning layer
• $90,000 - $240,000: illustrative annual cost for 50 office seats based on published office benchmarks

These figures are not a quote for setting up a GCC in India. They are simply useful starting assumptions for financial modelling. The actual budget will depend on the city, headcount, employee mix, technology requirements, office model and complexity of the structure.

Why companies are looking at India for GCCs

The scale of India's GCC ecosystem is now difficult to ignore.

With more than 2,100 GCCs, 2.36 million professionals and approximately $98.4 billion in annual revenue, India has developed a mature ecosystem around global centres.

The nature of these centres is changing as well.

Technology, AI, engineering, research and product development are becoming increasingly important parts of the GCC model. In other words, companies are not simply looking at India for lower operating costs. They are also looking at the talent and capabilities they can build here.

For a foreign company, this changes the question from:

“How can we move some work to India?”

to:

“What part of our global operation can India eventually own?”

That is an important distinction when planning the GCC.

How Vidhu Duggal & Company can help

Setting up a GCC involves several connected areas including entity structuring, foreign investment, FEMA, taxation, transfer pricing, accounting and ongoing compliance.

Vidhu Duggal & Company provides advisory support for foreign business setups in India, along with services related to international taxation, FEMA, transfer pricing and regulatory requirements.

For a foreign company, getting these pieces aligned before incorporation, funding and hiring can make the overall setup easier to manage.

If you are evaluating how to set up a GCC in India, the right starting point is not simply registering an entity. It is understanding what you want the Indian operation to do, how it will be funded, how it will work with the overseas parent and how you expect it to grow.

Frequently Asked Questions

How do you set up a GCC in India?

The process generally starts with defining the GCC's functions and headcount, followed by selecting the city and legal structure, arranging funding, completing registrations, setting up tax and transfer pricing arrangements, hiring employees and establishing the operating infrastructure.

What is the cost of setting up a GCC in India?

Broad industry estimates put one - time GCC setup costs at around $500,000 to $3 million, although a smaller or simpler centre can fall below this range and a large technology - heavy centre can require substantially more.

What is the GCC setup cost for 50 employees?

A 50 - person GCC can use approximately $500,000–$800,000 as an initial planning range for setup, but the actual amount will depend on the city, office model, technology infrastructure and hiring requirements.

Is there a minimum number of employees required for a GCC in India?

There is no universal headcount that applies to every GCC. A company can start with a small specialist team and expand as the Indian operation develops.

Which city should I choose for my GCC?

Bengaluru, Hyderabad, Delhi NCR, Mumbai, Chennai and Pune are established GCC locations. The appropriate choice depends on talent availability, operating costs, infrastructure and the functions planned for the centre.

Does a GCC need an Indian company?

The appropriate structure depends on the foreign company's activities, ownership model and investment requirements. A dedicated Indian operating entity is commonly used for companies establishing their own GCC, but the structure should be determined based on the specific business model.

Does transfer pricing apply to GCCs?

It can. Where an Indian GCC provides services or enters into transactions with its overseas parent or another related foreign entity, Indian transfer pricing provisions may apply.

How long does it take to set up a GCC in India?

A straightforward GCC can be planned around a 12–16 week implementation window, although larger or more complex projects may take longer.

Can a GCC start small and grow later?

Yes. A phased approach can allow a company to start with a core team and add functions and employees as the operating model develops.

What is the first step in setting up a GCC in India?

The first step is to define the business purpose of the GCC. Decide what functions India will handle, how many people will be required, how the Indian entity will interact with the overseas parent and what the long - term growth plan looks like. Once these are clear, the legal, tax and operational structure can be built around them.