In recent years, India has undergone a rapid transformation into a global technology and services hub, emerging as a powerhouse driven by both domestic and international IT companies at the forefront of cutting-edge technological innovation.
We’ll break down and explore the insights presented by Kesava Reddy, Chief Revenue Officer at E2E Networks Ltd, to grasp the essence of the author’s perspective.
You can read the article here.
The Rise of GCCs in India
Fueled by a vast talent pool, a supportive corporate and legislative climate, and evolving infrastructure, India's capability centers of global organizations (GCCs) have witnessed exponential growth, employing over 1.3 million people and generating a staggering US$33.8 billion in revenue in 2020.
The Global GCC Capital
‘GCCs in India are primarily driven by engineering and R&D services, which account for 56% of total revenue. They have evolved as the epicenter of innovation, even transforming the parent companies which were their origins.’ - Kesava Reddy
Looking ahead to 2023, the count of GCCs in India has skyrocketed to 1,580, and forecasts indicate a further rise beyond 1,900 by 2025, reaching a formidable 2,400 by 2030. India has rightfully earned the title of the ‘global GCC capital,’ commanding more than fifty percent of the global GCC market. A crucial driving factor behind these centers is their dedicated focus on engineering and research & development (R&D) services. These GCCs have transformed into innovation hubs, influencing even their parent companies from their inception.
Driving Digital Transformation in Manufacturing
‘With the emergence of Artificial Intelligence and Machine Learning, we are now entering a new era in manufacturing, one that has been dubbed the fourth industrial revolution, or Industry 4.0, or the second machine age.’ - Kesava Reddy
The significance of GCCs in India extends beyond their role as innovation hubs; they play a vital role in propelling innovation and digital transformation in the manufacturing industry. As Artificial Intelligence (AI) and Machine Learning (ML) usher in the fourth industrial revolution, their impact on manufacturing is monumental.
AI's Transformative Force in Manufacturing
The transformative impact of AI lies in its capacity to amplify productivity, reduce costs, improve quality, and minimize downtime. Cutting-edge technologies like Deep Learning Neural Networks play a pivotal role in data analysis, supporting decision-making and delivering advantages such as accurate demand forecasting, heightened operational efficiency, optimized supply chains, personalized product offerings, and the reduction of material waste.
Explosive Growth Projections
The burgeoning AI landscape in manufacturing is evident in the staggering growth projections, with AI for manufacturing expected to surge from $1.1 billion in 2020 to a remarkable $16.7 billion by 2026, showcasing an astonishing Compound Annual Growth Rate (CAGR) of 57 percent.
Talent Pool: A Key Building Block
‘The country’s technology workforce grew up in an internet/cloud-first world, and its ability to assemble solutions from combinations of legacy, cloud, and SaaS components is world-class.’ - Kesava Reddy
Integral to the success of GCC-driven manufacturing in India is the country's rich talent pool in the AI/ML domain, producing 16% of the global AI workforce and ranking among the top three contributors globally.
Cloud Infrastructure's Role
Supporting this upward trajectory, Cloud Service Providers (CSPs) and Hyperscalers originating from India have promptly developed the essential Cloud GPU infrastructure and vital Machine Learning platforms for driving AI innovation. This infrastructure, built upon advanced Cloud GPUs and GPU Clusters, furnishes the indispensable foundation for training AI algorithms.
Government's Commitment to AI
Moreover, the dedication of the Indian government to the adoption and international regulation of AI is driving advancements in AI within the manufacturing sector. The 2023-24 Union Budget underscored the initiative of ‘Building AI in India and Making AI Beneficial for India,’ unveiling plans to establish three ‘Centers of Excellence’ dedicated to AI research in top-tier educational institutions.
Revenue Growth and Future Prospects
‘The country’s technology workforce grew up in an internet/cloud-first world, and its ability to assemble solutions from combinations of legacy, cloud, and SaaS components is world-class.’ - Kesava Reddy
In 2022, the revenue generated through AI in India reached USD 12 billion, with expectations of rapid growth in the coming decade. The collaborative synergy between GCCs, government policies, and innovative IT companies is steering India's evolution into a global manufacturing powerhouse in the AI and ML-driven era.
This combined endeavor not only demonstrates technological excellence but also embodies a comprehensive vision that includes policy backing, nurturing talent, and fostering global collaboration. This firmly establishes India on the global tech stage.