More than 100 Japanese companies have established or expanded Global Capability Centres (GCCs) in India, with their mandate shifting sharply from back-office support to high-value functions including artificial intelligence (AI), engineering, digital innovation, product development, cybersecurity, and advanced analytics, according to a report released on Wednesday, 21 October 2026. The findings, published by real estate services firm Cushman & Wakefield, signal a structural change in how Japanese multinationals are leveraging their India operations.

From Cost Centres to Strategic Hubs

The Cushman & Wakefield report describes the evolution as a fundamental shift in Japanese global operations — GCCs are no longer being used primarily to cut costs but are being repositioned as strategic capability hubs. According to the report, these centres are now helping Japanese enterprises accelerate digital transformation, address domestic talent shortages, and drive enterprise-wide innovation at scale.

Arpita Srivastava, Managing Director, APAC Tenant Representation & GCC Advisory at Cushman & Wakefield, was direct in her assessment. 'This is no longer a story of outsourcing,' she said, adding that Japanese companies 'are building strategic capability centres that create business value, drive innovation and support global transformation initiatives.'

Why India Is the Preferred Destination

India's appeal rests on several structural advantages, according to the report. The country's STEM talent pool — estimated at 2.5 to 2.8 million graduates annually — stands out as a primary draw. This is complemented by world-class office infrastructure, established technology clusters, and a mature investment ecosystem that together reduce operational risk for foreign enterprises.

Srivastava noted that India offers 'a unique combination of talent, operational maturity and scalability that enables companies to build centres focused on innovation rather than just execution.' Notably, Japanese firms are not merely staffing existing roles from India — they are integrating their India GCCs more deeply into global innovation and decision-making processes as the mandates of these centres grow more sophisticated.

AI and Engineering Excellence Driving the Next Wave

The report flags AI, engineering excellence, and co-creation as the defining themes of the next phase of GCC growth. Japanese companies are reportedly moving decisively in this direction, assigning higher-value work to their India teams and treating the relationship less as a vendor arrangement and more as a long-term strategic innovation partnership.

'The next wave of GCC growth will be defined by AI, engineering excellence, innovation and co-creation, and Japanese companies are already moving decisively in that direction,' Srivastava said. 'This relationship is evolving into a strategic innovation partnership built on shared expertise, long-term investment and sustainable growth.'

What This Means for India's GCC Landscape

India has emerged as the world's most active GCC destination over the past decade, hosting centres for companies across the US, Europe, and Asia-Pacific. The Japanese influx adds a new dimension — historically, Japanese corporations have been more cautious about offshoring core functions. Their accelerating presence suggests a broader acceptance of India as a high-trust, high-capability partner rather than a low-cost execution base.

According to the report, the question for many Japanese organisations is no longer whether to establish a GCC in India, but how quickly they can scale their strategic capabilities. With India's technology ecosystem maturing and AI talent demand rising globally, the pace of this expansion is likely to accelerate through the remainder of the decade.