Regulatory compliance key consideration for GCCs in India: Study

Bengaluru: Navigating complex regulatory requirements such as transfer pricing, special economic zone regulations and labour laws are key considerations for global capability centres (GCCs) operating in India, according to a Nasscom-KPMG study released at the technology industry body's annual GCC Conclave held in Bengaluru on Thursday.

About 81% of the GCC executives surveyed listed transfer pricing as their top regulatory priority, while 67% stated SEZ/STPI regulations and 60% said labour laws were amongst their key regulatory priorities.

Besides these, for the CXOs surveyed, corporate tax, DPDPA (Digital Personal Data Protection Act) and FEMA (Foreign Exchange Management Act) are amongst the top-5 regulatory considerations, per the report.

As GCCs continue to evolve and adapt, proactive engagement with regulatory frameworks will be paramount in ensuring sustained success and contributing to India's position as a global business hub, the report noted. 

This apart, 96% of the leaders interviewed cited adoption and leveraging of emerging technologies as a crucial priority for achieving sustained growth, while 72% of the GCC leaders identified talent management as a key priority.

External considerations regarding emerging technologies include considerations tied to third party, regulatory and compliance considerations, and the tech landscape and cyber threats. Meanwhile, internal considerations encompass quality and reliability of content, data and considerations related to governance and ethics.

Lastly, 44% of those interviewed expressed the view that it is imperative to delayer concerns around concentration while only 20% of the survey respondents viewed the concentration of GCCs in India as a perceived risk.

"As GCCs continue their growth trajectory, moving up the maturity curve, with factors such as blurring geographic borders, and technology disruptions, these centres are constantly scanning the dynamic risk landscape and adapting to successfully navigate through," said Srikanth Srinivasan, vice president at Nasscom.

As of 2022, over 1,580 GCCs operated in India employing a work force of 16.6 lakh, according to a report released by property consultancy CBRE earlier this week. By 2025, this number is expected to rise to  1,900 with a professional talent pool exceeding 20 lakh, it added.