GCCs and the "Europe+1" – Impact of THe EU-India FTA catching Momentum

In the case of a European automobile company quietly moving its high-tech engineering and software design services to a Bengaluru Global Capability Center (GCC) in 2024, the move was not only about cost optimization but also about placing a strategic bet on a new Europe+1 reality. Both India and the EU have a wealth of IT, R&D, and talent bases that are currently available at a time when the EU-India Free Trade Agreement (FTA) is gaining significant traction. This presents a challenge for Europe, which must diversify its supply chains and arm itself with talent bases outside of Europe. This convergence will determine the way international corporations will carry out Starburst international marketing and global business expansion in the coming decade.

Introduction

The macro narrative of India is also interesting: IMF and government forecasts in 2024- 25 put India on the list of the fast-growing large economies, with GDP growth outlooks rising to the mid-high single digits – increases in corporate investment. Meanwhile, bilateral trade between the EU and India has increased significantly over the past few years (transacting some €120 billion in goods in 2024), and an ambitious EU3FA trade agreement is currently going through several rounds with both parties working hard to get the deal done. This will imply a more straightforward regulatory and commercial route to scale GCC-led operations in India by European firms who pursue a Europe+1 strategy.

The Importance of GCCs To The Europe+1 Strategy

India no longer has back offices that are Global Capability Centers. They are centers of innovation: R&D, data science, product engineering, AI laboratories, and digital product development groups that are accessible to markets around the world. In India, there are 1,900+ GCCs, and an increasing number of new centers are targeting digital and R&D services, which is exactly the capability that European companies desire to co-locate as they diversify, not only as a result of increasing their interdependence on European or Chinese ecosystems. GCCs serve as functional intermediaries between policy (FTA commitments) and implementation (talent, tech, and speed).

https://inductusgcc.com/wp-content/uploads/2025/11/GCC-Image62.4-1.jpg

How the EU–India FTA accelerates Europe+1

Strategic Area	Challenges Before FTA	Projected Impact After FTA	GCC Advantage for Europe+1 Strategy
Trade & Tariffs	– Minimal involvement of India in EU supply lines was caused by high importation charges and complicated customs regulations. – Slows down in materials acquisition and distribution of goods.	– Tariff cuts and simplified customs procedures are likely to facilitate the trade between the EU and India. – More direct rules of origin and quick movement of goods.	– GCCs in India have a chance to run as regional trade and sourcing centers controlling supply chains, analytics, and export logistics of European companies.
Services & Data Flows	– The need for data localisation and scattered digital trade standards limited cross-border IT services. – Weak capability in operating pan-European digital projects in India.	– Digital trade chapter to standardise data, cybersecurity, and online service regulations. – Simple movement of data and services across regions.	– GCCs are able to provide cloud, AI, fintech and cyber security services directly out of India to European markets, which makes India a stronger base of delivery in digital to Europe.
Intellectual Property & R&D Collaboration	– Low IP protection discouraged technology sharing and collaborative innovation of high-end technology. – Hesitation in co-developing patented products.	– Better IP laws that are in line with the EU standards. – Co-investment in such industries as green hydrogen, semiconductors, and pharma.	– GCCs develop into innovation and research centers, and Indian engineers partner with European ones in terms of patented technology and product design.
Talent Mobility	The policies of visas and work permits were stricter, and they slowed the process of working at another place. – Low agility in cross-marketing of projects.	– Free movement of skilled labour in the fields of IT, engineering and finance. – Accelerated project-based tasks.	– GCCs make teams more flexible and have experts move to India and Europe in minutes, reinforcing agile and distributed global workforce practices
Green & Sustainable Technology Collaboration	– Disjointed climate partnership and individual funding policy. – Low renewable innovation synergy.	– FTA will contain climate cooperation and green technology chapters. – Renewable, EV, and sustainability analytics R&D.	– GCCs emerge as centers of sustainability innovation, developing solutions together to achieve the green target in Europe and India for renewable development.
Overall Strategic Outcome	– Low trade synergy, policy dispensation, and inequalities in innovation.	– Digital and trade adaptation between the EU and India. – More investment inflow, clarity on regulation and momentum of innovation.	– The Europe+1 strategy is grounded by GCCs by integrating policy opportunity (FTA) with the execution excellence (talent, tech and R&D) to maintain international markets.

Human-Centred Transformation

The Europe+1 shift is not just a spreadsheet effort on the part of a company; it is a human narrative of joint creation. Indian engineers and data scientists are increasingly included in product teams for German precision, Nordic sustainability goals, and French experience design. GCCs provide European companies residing there with a substantial English-speaking STEM labour pool, state-of-the-art cloud and data engine solutions, and a rapid delivery pace in time attributes important to product cycles in AI, fintech, cleantech and advanced manufacturing. Trade liberalisation results in new products, faster time to market, and more efficient supply chains thanks to human networks.

Economical Advantages

Scale with cost-competitiveness: India has large pools of talent on a scale which can be used in R&D and in the building of units at lower costs.
Market diversification: Europe diversifies by bringing India as a partner to the Indo-Pacific and is less concentrated.
Reduced time to innovation: Co-located GCC teams speed up prototyping and European market localisation.
Green and tech partnership: Investing in renewables, EV hardware and digital offerings come together on shared climate agendas.
Employment and export growth: More FDI through GCCs generates high-value jobs and intensifies the service exports of India.

New Trends And Short-Term Strategies.

Four interconnected trends are forecasted within five years:

(1) European companies will acquire GCC mandates of delivery to product ownership;

(2) Hybrid R&D centres – situated between Europe and India – will become standard;

(3) Accelerators of the sector (mobility, pharma, green technology, semiconductors) will be institutionalised through public-private cooperation;

(4) The implementation of the EU-India FTA will create larger cross-border projects in GCCs due to the harmonisation of regulations, particularly data regulation and green standards. The latest cycles of FTA negotiations are indicative of a political desire to speed up such results.

Conclusion

The firms must wisely understand this agreement as a platform for co-creation if the EU-India Free Trade Agreement is to succeed. GCCs are the working infrastructure that transforms the treaty text into new products, jobs and bilateral value. India is more than just a cost point for European businesses looking to enter foreign markets. It is a strategic +1 with scale, speed and skills. Companies that create GCCs to own products, collaborative IP and switch to green work will lose the upcoming chapter of business expansion in the globe.

https://inductusgcc.com/wp-content/uploads/2025/11/GCC-CTA62.3-1.jpg

frequently asked questions (FAQs)

What is a Global Capability Centre (GCC)?

A GCC is an offshore facility of a multinational company that undertakes niche roles such as research and development, information technology service and strategic management.

What is the Stand-Up India scheme?

It is a government program that gives the women entrepreneurs up to 1 crore in bank loans to fund greenfield projects.

What are the challenges associated with women in tech?

Personal responsibilities and unconscious bias are the factors that lead to their mid-career attrition and slow them down in their careers.

What is the effect of women leaders in the innovation process?

They introduce new ideas, understanding, and team-oriented leadership that speeds up the advancement of such areas as AI and cybersecurity.

What does the future of women in the leadership of the GCC hold?

By 2030, women are expected to take up 25-30 per cent of GCC leadership positions, which will be paramount to the growth of the Indian market.

https://inductusgcc.com/wp-content/uploads/2025/05/1-3.png

Aditi

Aditi, with a strong background in forensic science and biotechnology, brings an innovative scientific perspective to her work. Her expertise spans research, analytics, and strategic advisory in consulting and GCC environments. She has published numerous research papers and articles. A versatile writer in both technical and creative domains, Aditi excels at translating complex subjects into compelling insights. Which she aligns seamlessly with consulting, advisory domain, and GCC operations. Her ability to bridge science, business, and storytelling positions her as a strategic thinker who can drive data-informed decision-making.