India Can Emerge as World's 'Office Space' Through AI-Led GCCs: MeitY Secretary

New Delhi: India has the potential to become the "office space of the world" by managing not just global back-office functions but also front-end business operations, with artificial intelligence (AI) acting as the key enabler of this transformation, Electronics and IT Secretary S. Krishnan said on Wednesday.

Speaking at the CII GCC Business Summit, Krishnan said India now has an opportunity to move beyond its traditional role as a low-cost outsourcing destination and emerge as a global hub for high-value decision-making, innovation and enterprise operations.

"AI provides a historic opportunity to transition from low-order execution to high-value strategic functions. However, human oversight and governance will remain critical, and Indian Global Capability Centres (GCCs) must lead that shift," he said.

Krishnan said the government is working with industry to reskill and upskill the workforce for an AI-driven economy, enabling India to leverage its talent pool and cost competitiveness. He added that AI adoption should boost productivity across sectors such as manufacturing and financial services while creating locally relevant and scalable solutions.

Highlighting India's GCC ecosystem, the MeitY Secretary said policy reforms aimed at supporting these centres are largely in place, and the next focus should be on measuring their impact and using AI to move GCCs further up the value chain.

Krishnan also said that the government's move to waive basic customs duty on key components for electronics manufacturing will help deepen the value chain and the ecosystem. Terming it an "important change", Krishnan said the move will also stimulate the electronics component industry in the country.

"Based on industry representations, this is something that we had taken up with the Ministry of Finance. We are very happy that these notifications have been issued. This will really stimulate the electronics industry, especially the electronic component industry in the country," Krishnan said on the sidelines of the CII GCC Business Summit.

The government has waived basic customs duty on goods used in the manufacturing of display assemblies, lithium-ion cell and inductor coil module with an aim to promote domestic production of electronic devices.

The finance ministry issued three separate notifications giving effect to the basic customs duty (BCD) waiver on the goods used in the manufacturing of the three key components used in electronic devices.

Chief Economic Adviser V. Anantha Nageswaran said India's GCC ecosystem has undergone a structural transformation from cost-saving back offices to strategic centres handling design, enterprise innovation, AI development and high-value decision-making.

He noted that India currently hosts nearly half of the world's Global Capability Centres and is the world's second-largest hub for enterprise AI talent. According to him, Indian engineers have built strong credibility with multinational companies through work in semiconductor design, artificial intelligence, machine learning and digital technologies.

Nageswaran said AI would increase demand for skilled professionals rather than eliminate the need for human expertise, stressing that AI systems still require people to build, deploy and govern them. He warned that only GCCs that continue moving into higher-value functions would remain globally competitive.

He also highlighted recent government initiatives, including simplified transfer pricing safe harbour rules and the proposed National Guidance Framework to promote GCCs in Tier-II and Tier-III cities, while urging industry to bridge emerging skill gaps.

Meanwhile, International Financial Services Centres Authority (IFSCA) Chairperson K. Rajaraman pitched GIFT City as a preferred destination for AI-led GCC expansion, citing tax incentives, a globally aligned regulatory framework and an ecosystem designed to attract multinational firms.

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