More than 100 Japanese companies have established or are expanding Global Capability Centres (GCCs) in India, with a growing focus on artificial intelligence (AI), engineering, digital innovation, product development, cybersecurity and advanced analytics. The shift marks an expansion beyond traditional back-office and operational support functions towards higher-value technology and innovation activities.Japanese companies are increasingly using their Indian GCCs to support digital transformation, address talent shortages and contribute to global business strategies. These centres are taking on responsibilities such as developing digital products, implementing AI and automation, strengthening cybersecurity, and delivering engineering and analytics solutions.“Japanese companies are not coming to India simply to reduce costs. They are building strategic capability centres that create business value, drive innovation and support global transformation initiatives,” said Arpita Srivastava, Managing Director, APAC Tenant Representation and GCC Advisory.The expansion is being driven by demand for digital and engineering talent, India's STEM graduate pool and the availability of established office infrastructure and technology clusters. India is estimated to produce 2.5 to 2.8 million STEM graduates annually, according to the information provided in the release.As GCC mandates become more specialised, Japanese companies are integrating their Indian operations more closely into global innovation and decision-making processes. Bengaluru, Hyderabad and Pune continue to be established destinations, while emerging talent markets are also being considered to support expansion and access specialised skills.Srivastava said the focus among Japanese companies was shifting from whether to establish a GCC in India to how quickly they could scale their strategic capabilities. She added that India's talent availability, operational maturity and scalability were supporting this transition.Japanese investment is also extending beyond GCC operations into office campuses, technology parks and real estate platforms that support India's innovation ecosystem. This positions Japan as both an occupier of GCC space and an investor in the infrastructure supporting the sector.The growing presence of Japanese companies reflects a broader shift in the role of GCCs, from cost-focused service centres to hubs for innovation, talent development and enterprise-wide technology initiatives.“Over the next decade, we expect Japanese companies to play an even greater role in the evolution of India's GCC ecosystem, while India will become an increasingly important source of innovation for Japanese enterprises,” Srivastava said.