Karnataka GCC policy: Driving innovation, investment, and growth in India’s tech hub

published on 8 April 2025 | reading time approx. 6 minutes

Global Capability Centres (GCCs) serve as key operational hubs for multinational corporations, offering services ranging from IT and research & development to finance and customer support. Over the years, India has emerged as a global leader in hosting GCCs, leveraging its skilled work-force and robust digital infrastructure.

GCCs in Karnataka

Karnataka, particularly Bengaluru, has cemented its position as a dominant GCC hub in India. Home to over 30% of the country's GCCs and 35% of the workforce, the state has a thriving eco-system that fosters innovation, talent development, and business expansion. The new Karnataka GCC Policy 2024-2029 aims to further strengthen this leadership and drive growth beyond Bengaluru into emerging cities.

The Frequently Asked Questions related to the Karnataka’s GCC Policy (Referred as ‘Policy’) has been discussed herein under.

What are the objectives of the Policy »
What is the time-period of the Policy »
What is the Policy Framework »
Who all are eligible to avail the benefits under the Policy »
What are the incentives available under Pillar: 1 Talent incentives under the policy »
What are the incentives available under Pillar: 2 Local Ecosystem under the policy »
What are the incentives available under Pillar: 3 Infrastructure incentives under the policy »
What are the incentives available under Pillar: 4 Regulatory easing under the policy »

What are the objectives of the Policy?

The Karnataka GCC Policy is designed to:

Provide platforms that enable GCCs to collaborate seamlessly with Karnataka’s vibrant local innovation ecosystem.
Create an investor-friendly business environment for GCCs to establish and expand their operations in Karnataka.
Foster a research and development driven environment focused on emerging technologies and deep tech, making Karnataka a hub for cutting-edge innovation.
Position Karnataka as a global leader in Artificial Intelligence (AI) with the most comprehensive AI R&D ecosystem tailored for GCCs.
Attract 500 new GCCs, reaching a total of 1,000 GCCs by 2029.
Generate 3.5 lakh new jobs within the state.
Achieve an economic output of US$50 billion from GCC operations by 2029.

What is the time-period of the Policy?

The policy is effective from 2024 to 2029, providing a structured framework for businesses to leverage Karnataka’s ecosystem for their expansion and innovation goals.

What is the Policy Framework?

The policy is structured around four key pillars:

Pillar 1 - Talent Development – Enhancing skills, training, and leadership programs.
Pillar 2 - Local Ecosystem Support – Strengthening startup collaborations and research.
Pillar 3 - Infrastructure & Incentives – Expanding business-friendly facilities.
Pillar 4 - Regulatory Easing – Simplifying compliance processes

Who all are eligible to avail the benefits under the Policy?

Entities eligible under the policy include:

New or existing GCCs in Karnataka.
Entities setting up co-working spaces.
Start-ups registered in Karnataka
State Government universities / affiliated colleges in the State.

What are the incentives available under Pillar: 1 Talent incentives under the policy?

The incentives are as follows:

Skilling of local talent by any new or existing GCC in the state: Government reimburses 20% of skilling expenses up to INR 36,000 per graduate and INR 18,000 per diploma holder for upto 100 employees or 15% of their total work force whichever is less.
Skilling Curriculum: Funds for developing industry-oriented courses INR 10,000 per student and INR 20,000 per faculty trained, with a cap upto INR 1 crore per institution. These benefit can be availed by any state Government universities/ affiliated/ autonomous colleges in the state of Karnataka.
Internships: Reimbursement of 50% of internship stipend upto INR 5,000 per month per intern for a period of maximum three months for maximum of 20,000 interns per year for any new or existing GCC in the State, hiring interns from State Government universities / affiliated colleges.
Recruitment assistance: Government will provide recruitment assistance to GCCs setting up or expanding operations in Beyond Bengaluru area.

No. of employees recruited	Percentage of assistance	Capping (INR)	Eligibility
100-250	10%	INR 35 Lakhs	Any new GCCs establishing presence and existing GCCs expanding to beyond Benga-luru area with minimum of 100 employees
>250-400	20%	INR 1.2 Crore
>500-700	30%	INR 3 crore
>700-1000	50%	INR 7 crore
=>1000	Customized package on case-to-case basis.

What are the incentives available under Pillar: 2 Local Ecosystem under the policy?

The incentives are as follows:

Establishing Innovation Labs/CoEs: Funding up to 40% of capital expenditure upto INR 5 crore in Bengaluru Urban District for any new or existing GCC in the state.
Utilization of GCC Labs and Technology: 100% reimbursement of the cost incurred by startups, for using GCC facilities, capped at INR 40 lakh per GCC. Entities eligible to avail these benefits are Labs and innovation spaces owned or operated by any GCC and any startup registered in Karnataka.
Establish 'GCC Immersive Hubs’ in Karnataka: Setting up of 'GCC Immersive Hubs’ to demonstrate innovation and R&D being undertaken in the State, on Public-Private Partnership (PPP) mode. Government will fund 50% of the total cost upto 1 Crore for setting up of these hubs. Any registered entity in the state/ industry associations can avail these benefits.
Host Events and Conferences: Government will provide funding equivalent to one-third of the cost up to INR 25 lakh for hosting events / conferences (up to 2 per year) in Karnataka. These benefit can be availed by any new or existing GCC or industry associations in Karnataka.

What are the incentives available under Pillar: 3 Infrastructure incentives under the policy?

The incentives are as follows:

Rental Assistance: Reimbursement of rent expenses based on the number of employees, capped at 50% of the rent expense upto INR 2 crores. These benefits are available to all new GCCs being setup with 100+ employees in Beyond Bengaluru area.
Co-working Spaces: Reimbursement for vacant seat costs in co-working spaces for three years based on the number of vacant seats.
EPF Contribution Reimbursement: Reimbursement of EPF contributions for new employments upto INR 3000 per employee per month for 2 years. These benefits are available to any new GCC being setup with 100+ employees in Beyond Bengaluru area.
Supporting Telecom Infrastructure development: Government will reimburse up to 25% of the internet expenses upto 12 lakh per year for the first three years for new GCCs being setup with 100+ employees in Beyond Bengaluru area.
Power related incentive: 100% reimbursement of electricity duty and option to switch from Commercial to Industrial power tariffs for any new GCC setting up in Karnataka.
Property tax assistance: a will provide a reimbursement of 30% of the property tax incurred by GCCs for a period of three years from the commencement of their operations for any new GCC being setup with 100+ employees in Beyond Bengaluru area.

What are the incentives available under Pillar: 4 Regulatory easing under the policy?

The incentives are as follows:

Regulatory approval for connectivity: Applications for permission for Right of Way for laying of cables and for erection of towers and antennae would be approved within 30 working days.
For Beyond Bengaluru area - Quality Certification Financial assistance: Government will provide 80% reimbursement of quality certification fees upto INR 8 lakh for any new or existing GCCs in beyond Bengaluru area.
For Beyond Bengaluru area - Intellectual Property Incentive: Any new or existing GCCs in Beyond Bengaluru area will receive a reimbursement of 50% of the statutory fees for filing patents, with a maximum reimbursement of INR 3 lakh for domestic patents.

Conclusion

The Karnataka GCC Policy 2024-2029 represents a strategic roadmap for strengthening the state’s position as a global innovation and business services hub. By extending targeted incentives, fostering talent development, and expanding beyond Bengaluru, the policy aims to drive sustainable economic growth and solidify Karnataka’s leadership in the GCC sector.

Navigating government incentives and policy frameworks can be complex, but that's where we come in. Our team offers end-to-end support for stakeholders looking to benefit from the Karnataka GCC Policy 2024–2029. Reach out to explore how we can tailor our support to your specific business goals in Karnataka.