Volatile geopolitics slows GCC in March
A total of 63 global talent centers (GCCs) opened in the March quarter, slowing from 74 a year ago, according to a report by UnearthIQ, part of market researcher UnearthInsight. Although the number of companies establishing the Gulf Cooperation Council from scratch increased from 24 in the previous year to 28 in the last quarter, project discussions decreased with the start of the Iran war.
“Brownfield activity fell 30% in the first quarter of 2026 as macro uncertainties pushed existing GCCs to halt expansion,” said Gaurav Vasu, founder of UnearthInsight. If geopolitical uncertainties subside, the number of new GCCs could reach 100 in 2026, virtually unchanged from 2025, he said. Although macro uncertainties have, of course, affected the establishment of the new GCC, their overall industry value, including revenue, scale of operations and capacity expansion, has been steadily increasing.
TeamLease Digital has predicted that India’s GCC ecosystem will grow at 18-22% annually. Nasscom had estimated GCC’s revenues in India at $64.6 billion in FY24. While the software industry body is yet to release updated figures for FY25 or FY26, industry estimates suggest the market will likely top $80 billion last fiscal year. The overall IT sector growth is estimated to be around 6% in FY26.
Two-way redistribution
Experts pointed out that the Gulf Cooperation Council (GCC) boom created a two-way redistribution structure rather than a direct displacement of IT services firms.
“GCCs are creating new demand and are also capturing share from IT service providers,” said Pareekh Jain, CEO of EIIR Trends, a research platform on engineering and R&D services. Industry estimates have shown that 30-50% of jobs moving to new GCCs previously went to IT services providers. However, 40-60% of GCC growth is driven by entirely new capabilities in AI, product engineering and digital platforms; these capabilities were never part of the outsourcing market to begin with.
At the same time, contracts are returning to IT services companies. Jain noted that Wipro acquired Olam’s GCC, Infosys acquired Danske Bank’s GCC, HCLTech acquired HPE Communication Group and Virtusa acquired Wiley’s GCC.
He cited the example of Danske Bank to point out the two-way relationship between the Gulf Cooperation Council (GCC) and IT suppliers. The lender outsourced the work to ITC Infotech in 2006, set up its own GCC in 2014, moved the work in-house and then sold GCC to Infosys in 2023. “This is a cyclical trend,” Jain said. “Companies are switching between GCC and third-party models based on company-specific or industry-specific situations.” Vikram Ahuja, co-founder of ANSR, said the bigger change is not about the scale of the work being moved, but the scope of the work. “Companies are keeping core IP-focused work in-house while relying on partners for scale, speed and specialized capabilities,” he said.
Industry estimates have shown that 40-60% of GCC growth comes from new talent creation rather than supplier substitution. Ahuja highlighted that areas such as artificial intelligence, product engineering and digital platforms are driving most of the expansion.
Despite the current setbacks, UnearthInsight’s Vasu expects new GCC expansions to continue as more firms use India to build technology, R&D and AI talent hubs.
