Budget 2026: The GCC capital of the world needs more brains to bank its $100-billion dream
But this transition also revealed a fault line; A widening skills gap emerges as Gulf Cooperation Council countries move up the value chain; If this situation is not addressed, it could limit the sector’s next phase of growth.
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With the sector aiming to reach $100 billion in revenue by the end of the decade, Budget 2026 offers Nirmala Sitharaman an opportunity to promote skill development initiatives to further accelerate the growth of the sector.
Starting off as a cost advantage, India has emerged as the GCC capital, accounting for 17% of the global GCC, and has scaled up over the last few years by offering value-added services, aided by the availability of technology talent at scale.
Earlier, in Budget 2025, Sitharaman had announced Phase II, which included measures focusing on talent and infrastructure. announced a national framework for the Gulf Cooperation Council in tier-1 cities.
Why is there a need for a talent section?
First of all, the GCC itself says talent has become their biggest headache. Nearly 51% of Global Talent Centers in India find talent retention to be the top challenge due to rising demand for specialized talent, CIEL HR finds GCC – Talent Trends and Insights report has been announced.
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Ironically, this is happening even as India has a clear cost advantage in the global AI talent war.
According to AMS data, the cost of Indian AI talent is typically around 15-25% of what companies pay in global hubs like the US, especially for senior and research-level roles.
According to TeamLease Digital, salaries in the US, UK or Europe are almost five times higher than the Indian average for similar skills. For mid-skill roles, such as machine learning engineers or experienced data scientists, the salary gap is approximately two to three times greater.
The country has now surpassed Japan to become the world’s fourth largest economy, and almost 68% of its population is of working age.
The workforce numbers around 600 million and the average age is only 29; This makes India one of the youngest major economies in the world.
This demographic dividend is a rare window of opportunity. Therefore, it becomes critical to leverage this advantage to secure global dominance in fast-growing industries.
“However, if the skill development ecosystem fails to keep up with the changing nature of future demand, it can also turn into a huge liability. This will create an additional burden on the GCC to set up in-house training facilities, increasing costs and thus reducing the overall attractiveness of the country,” Rohin Kapoor, Partner, Training and Skill Development, Management Consultancy, Business Consulting, BDO India, told ET Online.
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When it comes to talent challenges, GCC continues to face a 41% skills gap in AI, data and analytics, particularly in GenAI engineering, AI observability and MLOps integration, according to the Quesscorp report.
Platform Engineering follows closely behind with a 39% margin, driven by a lack of Terraform, Kubernetes, and hybrid cloud reliability expertise.
Meanwhile, Cloud and Infrastructure Engineering shows a 25% gap, largely in the area of FinOps automation and cloud-based cost management.
Although these gaps have narrowed marginally since Q4 26, they remain a major bottleneck in scaling AI-first and platform-focused capabilities, especially in Tier 2 locations.
“As India continues to produce strong engineering talent, GCCs increasingly require skills in AI engineering, data science, cloud-based architecture, cybersecurity, product management and platform engineering. These capabilities are critical for enterprise transformation but are still not available at scale,” Lalit Ahuja, CEO of ANSR, an organization that helps multinational companies set up Global Talent Centers in India, told ET Online.
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Commenting on entry-level employees, Praveen Mysore, Vice President of Global Product Technology and Head of India Technology Center, lululemon, said: “Looking ahead, continued investment in skills and emerging technologies is essential for Global Talent Centers (GCCs) in India to become global hubs of innovation. The skills gap is most pronounced at the entry level, where focused training programs are needed to prepare talent for industry demands.”
In addition to entry-level roles, GCCs also cater to mid- and senior-level talent. “There is a growing need for leaders who can own platforms, products and global mandates. While execution capability is strong, there is a shortage of professionals with end-to-end ownership experience, especially in AI-led, product-centric and engineering-intensive roles,” Ahuja said.
“GCCs spend a significant amount of time (about six months) and resources after recruitment to close skills gaps through internal academies, structured learning programs and on-the-job talent development. This reinforces the need for government-backed skills programs that are closely aligned with actual GCC requirements to reduce productivity time and increase global competitiveness,” Ahuja added.
Senior digital roles in AI and cloud architecture continue to be heavily concentrated in Bengaluru and Hyderabad, where mature ecosystems and strong peer networks remain key differentiators.
Ongoing skills gaps continue to impact the GCC’s recruitment strategies. While readiness at entry and intermediate levels is increasing, talent availability for specialist and senior roles remains limited, particularly in advanced digital functions.
As India prepares for the next wave of reforms with Budget 2026, skills priorities will need to be sharpened around artificial intelligence and intermediary systems, data engineering, cloud-based platforms, cybersecurity and product-focused engineering.
To sustain the GCC’s growth, equal emphasis must be placed on leadership capabilities that enable professionals to translate technology into measurable corporate outcomes and operate with global ownership and accountability.
What can Budget 2026 do?
India has witnessed rapid growth in the number and scale of GCCs.
Major global players such as Google, Microsoft, Shell, Goldman Sachs and Bosch have set up advanced centers in India that go far beyond traditional support roles.
ET had recently reported that Videotelephony firm Zoom, telecom giant T-Mobile and low-cost carrier Southwest Airlines were among the latest global companies considering setting up their GCCs in India.
According to the KPMG-Nasscom report, between 2018-19 and 2023-24, Gulf Cooperation Council countries created more than 600,000 new jobs, bringing the total to over 1.6 million. The future of the industry looks even brighter.
According to the latest Economic Survey, the Gulf Cooperation Council is projected to generate $121 billion in revenue by 2030; This is about 3.5% of India’s current GDP, with $102 billion expected to come from exports.
To further enhance the growth prospects of the sector in India, it is crucial to expand the Gulf Cooperation Council and leverage the potential of Tier 2 and Tier 3 cities. “Making non-metro capabilities GCC ready will require a coordinated approach between the Center and states. This includes targeted incentives for GCCs to set up advanced functions in Tier 2 and Tier 3 cities, investments in digital and physical infrastructure, and harmonized compliance frameworks to reduce operational complexity,” Ahuja said.
The government’s continued focus on technology-led growth, innovation and digital transformation has laid a strong foundation for the Gulf Cooperation Council to scale and expand its global mandate from India.
But sustaining this momentum will depend on progressive tax and regulatory measures that ease operational complexity, encourage innovation and further strengthen India’s competitiveness as a global services hub.
“The budget could also encourage deeper industry-academia partnerships by encouraging apprenticeships and co-development of courses and assessments,” said Kapoor. “At the same time, leveraging decentralized learning systems such as online and hybrid programmes, mobile skills units and joint training facilities can help reach young people in small towns and ensure that geography does not become a barrier to participation in the GCC growth story.”
Moreover, upskilling can become more effective with three key changes: funding what can be verified, using monitoring to improve delivery (not just reporting), and defining success as business results rather than certifications.
“On the funding front, milestone-based payments have been found to be most effective when tied to clear outcomes such as certification, placement and retention at 3, 6 and 12 months, with higher weights for priority roles and more difficult positions,” said Kapoor. “Employer-connected models also empower transformation, for example, ‘role-to-hire’ lines where employers co-design training, run short-bridge programs or apprenticeships, and commit to minimum tenure.”
There is also a need to focus on infrastructure needs for the expansion of the Gulf Cooperation Council. “Budget 2026 should exceed overall policy targets and create precise, implementation-oriented incentives that effectively reduce costs, reduce risks and accelerate the scaling process for GCCs,” TOA Director Aditya Yamsanwar told ET Online.
“It should support GCC-led campus and entry-level talent initiatives and provide specialized workspaces to R&D and innovation-focused regions, with a special focus on creating a centrally aligned GCC framework with a strong on-site execution mechanism,” Yamsanwar said.
Along with the skills, the budget could accelerate the GCC’s growth by making it faster and cheaper to set up and scale operations beyond metropolitan cities.
Deloitte’s Rohan Lobo, Partner-GCC Sector Leader and Manisha Gupta, Deloitte, said: “Introducing targeted tax benefits for people working in GCCs in Tier-2 and Tier-3 cities can significantly facilitate the recruitment of talent and also enable more equitable regional growth. Such measures will encourage skilled professionals to expand beyond major metropolitan centres, support economic development in smaller cities and encourage expansion of GCC operations in these regions.” “It will help build a sustainable talent pipeline,” he said.
