Setting Up a Global Capability Center (GCC) in India

Setting up a Global Capability Center (GCC) in India is a strategic move that can help you tap into a vast talent pool and reduce operational costs.

In this guide, we’ll walk you through the essential steps, key considerations, and how to navigate the complexities of establishing your Global Capability Centres (GCC) in India.

What are the key steps for setting up a GCC in India?[toc=Setting up a GCC in India Steps]

Setting up a Global Capability Center (GCC) in India requires strategic planning. Let’s break down the essential steps to get your GCC up and running smoothly.

1. Define Strategic Objectives

Start by defining what your GCC will focus on, be it IT services, R&D, or finance. Aligning its purpose with your long-term business goals is key.

2. Conduct Feasibility Study and Choose Location

Do a feasibility study to evaluate cities based on talent, infrastructure, and costs. Bengaluru, Hyderabad, and Tier 2 cities like Coimbatore offer great options.

3. Select Legal Structure and Operating Model

Choose your legal structure. Wholly Owned Subsidiary (WOS) is common, but Branch Offices or LLPs can offer flexibility depending on your needs.

Understanding company registration in India helps you make the right choice for your GCC structure.

4. Legal and Regulatory Compliance

Ensure your GCC complies with Indian regulations. This includes registering your entity, obtaining necessary tax IDs, and following labor laws in India.

Staying compliant with India's complex HR compliance requirements is essential to avoid penalties and ensure smooth operations.

5.  Establish Infrastructure and Technology

Set up the right infrastructure, office space and IT systems, and consider leveraging Special Economic Zones (SEZs) for tax benefits.

6. Talent Acquisition and HR Strategy

Recruit skilled professionals and build a strong HR strategy to keep talent engaged and compliant with local labor laws. Consider hiring solutions in India to streamline your recruitment process and access pre-vetted candidates.

These key steps set you up for success, but there are a few more important factors to consider. Let’s dive into those next.

What are the key considerations for setting up a GCC in India?[toc=Key Considerations]

While setting up a GCC in India offers significant benefits, there are key considerations that can make or break the success of your center.

Let’s dive into what you need to keep in mind.

1. Taxation and Compliance

India’s tax regulations, including transfer pricing, are critical to your GCC's success. Transactions between your GCC and the parent company must be at "arm’s length" to ensure compliance.

Wisemonk helps businesses navigate tax compliance in India, ensuring proper tax deductions, documentation, and compliance, making sure everything runs smoothly and minimizing the risk of penalties.

2. Government Incentives and Support

India offers state-specific tax exemptions, subsidies, and incentives designed to encourage foreign investment. These can help you reduce operational costs, especially when setting up in certain regions or Special Economic Zones (SEZs).

By understanding and leveraging these benefits, your GCC setup can become more cost-effective and strategically positioned in India’s growing innovation hubs.

3. Risks and Hidden Costs

Setting up a GCC in India comes with its own set of hidden costs, like regulatory compliance hurdles and unexpected fees. India’s legal and regulatory landscape can be complex, and navigating it without local expertise can lead to delays or higher expenses.

That’s why partnering with local experts is crucial, they help mitigate these risks and ensure your GCC is set up efficiently and cost-effectively. When comparing your options, understanding the cost of Employer of Record services versus setting up your own entity can help you make informed decisions about your India expansion strategy.

These considerations will help you manage potential challenges as you establish your GCC in India.

Now that you're clear on the key factors, let’s explore how Wisemonk can support you in this journey.

Get Started with Wisemonk EOR[toc=Wisemonk EOR]

Wisemonk is a leading Employer of Record (EOR) in India that simplifies the process of setting up and managing a Global Capability Center (GCC) in India. We handle all the local compliance, tax regulations, and employment laws, so you can focus on scaling your operations.

FFrom registering your legal entity to managing talent acquisition, employee benefits, and day-to-day operations, Wisemonk ensures your GCC is fully compliant and running smoothly. We make navigating India's complex regulatory landscape effortless, so you don't have to worry about hidden risks or costly delays.

Whether you're hiring employees in India for the first time or building an offshore team, our comprehensive services cover everything from payroll compliance to full-cycle recruiting.

Ready to build a GCC in India? Contact Wisemonk today to ensure a seamless, compliant, and efficient process.