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This is the second issue of our India Rising Perspective by Zinnov: “Engineering Europe’s Future with India”. I’m super excited that I have the opportunity to share this series with you, and thankful for the contribution by the Zinnov team.

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India’s rise as the world’s 3rd largest economy is not unfolding in isolation. It is being shaped through deep and strategic partnerships with Europe’s leading enterprises. Across Germany, the UK, and broader EMEA, companies are strengthening their global competitiveness by building long-term capability in India.

This story is no longer about outsourcing or cost efficiency. It is about engineering velocity, AI-driven transformation, workforce reinvention, and collaborative operating models that integrate India into the core of European enterprises.

To understand how this capability corridor is being built — and what it means for Europe’s future — we turn to one of the region’s leading advisors on Global Capability Centers and enterprise transformation.

In this series, Mohammed Faraz Khan, Partner at Zinnov, will share insights from across EMEA on how European organizations are designing, scaling, and transforming their Global Capability Centers in India — and how this partnership is reshaping competitiveness on both sides.

The author of today’s issue of the India Rising Perspective - Engineering Europe’s Future with India is Mohammed Faraz Khan, Partner at Zinnov.

Faraz spearheads Zinnov’s GCC Setup and Transformation practice for the EMEA region and is based in London. He advises Fortune 500 and mid-market European organizations on designing, scaling, and optimizing Global Capability Centers to accelerate globalization and unlock long-term value.

With deep expertise spanning workforce transformation, collaborative operating models, productivity enhancement, and innovation enablement, Faraz works across industries including Industrial & Engineering, Automotive, BFSI, Software & Internet, Energy, and Semiconductors. He is actively shaping the GCC narrative in EMEA and has been featured in leading publications such as The Economic Times and Fortune India.

Through this series, Faraz brings a practitioner’s lens to the evolving Europe-India partnership — grounded in enterprise transformation, AI enablement, and strategic capability building.

Enjoy the second issue of our series!

Part 2 of India Rising Perspective - Engineering Europe’s Future with India
By Mohammed Faraz Khan

When European companies like Bosch, Mercedes-Benz, Volkswagen and many other first began setting up Global Capability Centers (GCCs) in India, the mandate was often straightforward: operational efficiency.

Teams were established to support technology delivery, shared services, and engineering backlogs. These centers played an important role in scaling enterprise operations globally.

But that mandate didn’t hold for long.

As these centers matured and teams expanded, they began taking on larger mandates — designing products, building AI systems, and shaping enterprise technology strategies. What started as execution hubs increasingly evolved into innovation engines embedded in the global enterprise.

Today, that evolution is particularly visible among European companies operating in India.

As these centers evolved, a clear pattern began to emerge across European GCCs. Engineering became the core of their capability footprint.

This shift is also reflected in the scale and composition of the ecosystem. EMEA-headquartered GCCs have grown by approximately 41% between 2019 and 2024 and now account for over 25% of total GCCs in India, highlighting the increasing strategic importance of Europe-origin centers.

Within this, Germany stands out for the depth of its engineering focus. Over 95% of Germany GCCs in India have an engineering and R&D presence, underscoring how central product and engineering capability is to their mandate.

This is further reflected in talent composition. Zinnov’s research shows that engineering and R&D roles account for 51% of talent in Germany GCCs, significantly higher than IT or business process functions.

In practice, this translates into GCCs that are deeply embedded in product development and industrial innovation — from embedded systems in automotive platforms to engineering design in industrial equipment.

This engineering focus is shaping how GCCs evolve.

Rather than functioning purely as delivery centers, these hubs are increasingly responsible for product engineering, platform development, and digital transformation initiatives, serving global markets.

Traditionally, GCCs were associated with large multinational corporations. They have since evolved in multitudes, and their growth has been anything but linear.

Today, mid-sized industrial firms are increasingly adopting the model as well.

One of the most notable developments in recent years has been the growing presence of Germany’s Mittelstand companies in India’s GCC ecosystem.

Zinnov’s analysis shows that nearly one in three Germany-based GCCs in India belongs to a Mittelstand company including Brose, STULZ, FEV, Carl Zeiss and many others.

The scale of this shift is significant.

Over the past five years, Germany Mittelstand GCCs in India have grown by 108%, reaching 25+ centers employing more than 7,300 professionals across 33+ operating units.

These centers are heavily concentrated in engineering-driven sectors such as:

The trend highlights an important shift: GCCs are no longer a model used only by global giants - they are becoming a strategic lever for mid-sized European innovators.

Geography also plays a role in how these capabilities scale.

Zinnov’s report on the Germany GCC Landscape in India shows that Bengaluru and Pune have emerged as the primary hubs for Germany GCCs in India, representing ~46% of the Germany GCC units and over 60 % of Germany GCC talent in India.

​Bengaluru remains a microcosm for multi-industry GCC talent for German MNCs, with the highest concentration in Automotive, Software & Internet and Medical Devices industries.

Pune, on the other hand, stands out by housing both the highest number of German Automotive centers and the largest concentration of German BFSI talent across the country including large development teams from companies such as Brose, FEV, and Marquardt.

These clusters create a network effect. Companies benefit not only from talent availability but also from proximity to universities, startups, and technology ecosystems that support innovation.

The shift in GCCs is goes beyond scale — it’s where ownership sits and what work is being done. Across GCCs in India, ownership is increasingly defined by the complexity of problems teams solve and the systems they own.

Engineering teams are no longer limited to supporting development cycles. They are responsible for end-to-end modules, platform components, and, in some cases, entire product lines.

This is evident in the work being led from these centers — from ADAS systems and EV platforms in automotive, to silicon design in semiconductors, smart factories in industrial sectors, and decision science and AI platforms in financial services.

The evolution of Munich-headquartered Knorr-Bremse’s India center illustrates this shift clearly. What began as a support presence in the 1990s evolved into a dedicated R&D hub with the establishment of its Technology Center India (TCI) in Pune. Today, the center employs over 400 specialists and contributes directly to global product innovation — developing advanced braking technologies and supporting end-to-end engineering programs for its worldwide portfolio.

This is also reflected in how teams are structured. Architects, product managers, and platform leads now operate from GCC locations, working alongside global teams to shape system design and roadmaps.

In many cases, these centers are no longer downstream recipients of work — they are co-creators of global engineering strategy.

Artificial Intelligence is now accelerating this transformation.

While much of the public conversation around AI focuses on generative tools, enterprise adoption is driven by operational applications: predictive maintenance, industrial automation, risk modeling, and intelligent supply chains.

India’s rapidly expanding AI ecosystem provides a powerful foundation for these initiatives.

The country now hosts more than 200,000 AI and machine learning professionals, alongside 330+ AI startups and over 100 generative AI startups. According to Stanford’s AI Index 2025, India ranks #3 globally overall and is leading in AI skills penetration, highlighting the depth of its talent pool.

This environment allows European GCCs to build AI capabilities directly with greater continuity and integration into core engineering workflows.

As Zinnov’s whitepaper Future-proofing AI Strategy through Centers of Excellence (COEs) highlights, many AI initiatives struggle to move beyond pilots — not because of weak ambition, but because of fragmented data, legacy systems, and the absence of a clear operating structure. AI Centers of Excellence (COEs) help address this by aligning use cases with business priorities, standardizing how models are built and deployed, and enabling reuse across the enterprise.

Ericsson’s Global AI Accelerator (GAIA) is a strong example of this approach. Established in Bengaluru, the CoE helped centralize AI capability and scale it across domains such as 5G, IoT, and automation. Over time, it evolved into a hub for reusable AI assets and enterprise-wide transformation, accelerating time-to-market and embedding AI into core operations.

In many cases, AI capability within GCCs is now closely tied to product development, platform modernization, and enterprise transformation priorities.

What emerges from these patterns is a clear shift in how European enterprises are structuring capability.

GCCs are increasingly embedded within the core of the organization — owning engineering modules, building AI-driven platforms, and contributing directly to product and technology roadmaps.

This shift is also being shaped by structural pressures within Europe. In Germany, the scale of the talent gap is becoming harder to ignore — with shortages exceeding 160,000 STEM professionals and a projected deficit of over 130,000 IT experts, alongside persistent gaps in mechanical and automotive engineering roles.

As a result, many companies are finding it increasingly difficult to scale engineering capacity and sustain innovation at the pace required.

Expanding capability across geographies offers a way to rebalance this equation. India provides access to deep engineering and AI talent pools, allowing enterprises to build capacity while keeping ownership and strategic direction closely integrated with headquarters.

What is unfolding is not just the growth of GCCs, but a shift in how European enterprises build and sustain competitiveness.

Global Capability Centers are becoming the mechanism through which companies balance depth and scale — combining Europe’s product leadership with India’s engineering capacity.

This is particularly relevant as industries become more software-defined and innovation cycles accelerate. Companies that can expand capability without fragmenting ownership will be better positioned to compete.

In that context, the Europe–India corridor is evolving into something more fundamental — a shared capability layer underpinning global innovation.

And as GCC mandates continue to deepen — across engineering, AI, and product ownership — this model is likely to move

Sources: Zinnov

If you want to explore more on this topic or have questions, please reach out to the author via LinkedIn.

Disclaimer: Any use of the data or graphics require prior approval from Zinnov.

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