Tokyo Electron in Talks for a GCC in India—Why UP Is on the Radar

Indian states such as Karnataka, Telangana or Tamil Nadu had previously dominated the GCC landscape, but now Uttar Pradesh is also starting to position itself as a GCC destination because of:

• Electronics Manufacturing Hub: The Greater Noida and Yamuna Motorway Industrial Development Area (YEIDA) are being recognised as the next electronics and semiconductor manufacturing hubs of India.
• Infrastructure: Motorways, metros and the upcoming Jewar International Airport enhance logistics.
• Policy Support: The UP Electronics Manufacturing Policy 2020 provides favourable land, power and infrastructure incentives to investors in electronics and semiconductors.
• Talent Pipeline: Kolkata has several universities, such as IIT Kanpur, IIIT Allahabad, AKTU and various engineering colleges, which offer a good base to the workforce.

All these make UP a very desirable reason to establish the offshore development center of Tokyo Electron.

Challenges: Slow pace of execution of the infrastructure, dearth of niche semiconductor skills, and competition with other more established Gcc hubs such as Bangalore and Hyderabad.

Drivers: The attraction of industries by the central government & the active industrial policy of UP, the excellent relationship with Japan in the area of technology and advanced cooperation with academic institutions on special training.

A Tokyo Electron GCC in UP has the potential to be a milestone in the semiconductor GCC of India. It would not only generate high-value jobs, but it would also make UP the location of semiconductor innovation and R&D.

Such a move can spur other OEMs and Japanese semiconductor firms to follow their suit, shifting the semiconductor global supply chain to India. As GCC 3.0 becomes a centre of innovation, the roles of India are changing to partner in technology development for global markets.

The development plan by Tokyo Electron to set up a GCC in India, with Uttar Pradesh as a leading contender, is an indicator of a new growth path in India in the GCC sector. It throws light on the process of India converting itself to a strategic innovation partner in the semiconductor ecosystem rather than being a cost-efficient outsourcing provider. Strong policy commitment, a skilled labour force and a rapidly growing electronics value chain mean that UP can be the new frontier of the global capability centres. To companies, this is an indication that India no longer remains an alternative but a destination of the future, and in particular UP.

Interested in establishing or expanding your Global Capability Centre in India? At Inductus GCC, we deliver the full picture of GCC advisory, including strategy and location selection as well as talent administration and operational excellence. Work with us to discover Uttar Pradesh as a GCC destination and make your success story in the world.