Hyderabad: Telangana is preparing a new policy for global capability centres (GCC) that will move away from broad-based incentives and instead target companies working in frontier technologies such as space, semiconductors, artificial intelligence (AI), quantum computing and advanced life sciences, The Times of India reported quoting officials aware of the drafting process.
The shift comes as the state’s GCC ecosystem, already the fastest-growing in the country, matures beyond simple scale, prompting a rethink of what kind of investment deserves state support.
Studying rival states’ playbooks
The government is examining GCC policies adopted by Karnataka and Maharashtra, whose hubs in Bengaluru and Pune compete directly with Hyderabad, as it weighs targeted support for select high-value sectors over blanket subsidies.
A senior official in the state’s IT and Industries Department told TOI that incentives, where offered, would be reserved for investments capable of building entirely new ecosystems around the state. “Say, if a giant like SpaceX or Nvidia decides to put up their GCC here, that will drive pathbreaking technologies capable of a cascading effect on brand Hyderabad and the entire ecosystem; we would be open to offering incentives,” the official said.
The strategy is meant to carve out a distinct identity for the city. “We want to position Hyderabad as a cross-domain hub, as against Bengaluru’s enterprise research and development (R&D) concentration, Chennai’s automotive and engineering strengths and Pune’s auto, engineering and banking, financial services and insurance (BFSI) base,” the official added.
Push to spread GCCs beyond Hyderabad
Officials told TOI that the city’s edge lies in a talent base spanning life sciences, aerospace, defence, space technology, BFSI, retail, hospitality, fast-moving consumer goods (FMCG), utilities and advanced digital engineering, with GCCs increasingly building products and platforms rather than functioning as delivery-only back offices.
The draft policy will also try to steer new centres towards Tier-2 towns, including Warangal, Adilabad, Karimnagar and Nizamabad, rather than concentrating growth solely in Hyderabad.
Telangana crossed the 500-GCC mark after adding 75 new centres in 2025-26, the highest addition by any state in the country, and is targeting 100 more in the current financial year, of which about 55 have already been set up in Hyderabad.
State estimates put last year’s fresh investment through these 75 centres at Rs 1.43 lakh crore, generating 75,000 direct jobs and 2.25 lakh indirect ones, with the sector’s overall economic output pegged at Rs 3.9 lakh crore. GCC-linked employment in Hyderabad currently stands at around 4 lakh.
‘Not just for scale’
IT and Industries Minister D Sridhar Babu attributed the city’s growth to “infrastructure, talent, ecosystem and innovation,” saying companies were choosing Hyderabad “not just for scale, but to build high-value global capabilities.”
“Our ambition is to add 100 more GCCs, creating 1 lakh direct and 3 lakh indirect jobs,” he said. “We will continue to work closely with global investors and build on what makes Hyderabad uniquely competitive. At the same time, we will keep investing ahead of the curve in emerging sectors and new areas of innovation.”
Officials noted that the push towards GCCs is also a response to automation-driven disruption in traditional IT services, making higher-value, innovation-led centres a more durable bet for the state’s technology sector.
| 
