The Impact of Artificial Intelligence and Machine Learning in GCC-Driven Manufacturing

By Srikanth
5 Min Read
The Impact of Artificial Intelligence and Machine Learning in GCC-Driven Manufacturing 1

India has emerged as a global technology and services hub, driven by both Indian and global IT companies who are at the forefront of cutting-edge technology innovation. Due to India’s enormous talent pool, supportive corporate and legislative climate, and developing infrastructure India was already home to capability centers of 1,300+ global organizations (GCCs) in 2020, directly employing 1.3+ million people, generating approximately US$33.8 billion in revenue.

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As of 2023, the number of GCCs in India has now reached 1,580, and it is anticipated to surpass 1,900 by 2025 and 2,400 by 2030. India is deemed as the “global GCC capital” with over fifty percent stakes in the global GCC market.

GCCs in India are primarily driven by engineering and R&D services, which account for 56% of total revenue. They have evolved as the epicenter of innovation, even transforming the parent companies which were their origins. With a large pool of highly skilled IT talent, GCCs in India can easily find suitable talent with desired skills and align them with the objectives of the company.

Due to their focus on innovation, GCCs in India play a significant role in driving innovation and digital transformation in the manufacturing industry. With the emergence of Artificial Intelligence and Machine Learning, we are now entering a new era in manufacturing, one that has been dubbed the fourth industrial revolution, or Industry 4.0, or the second machine age.

The reason for AI’s massive impact in manufacturing is due to its ability to increase productivity, decrease expenses, enhance quality, and decrease downtime in manufacturing. Emerging AI technologies, such as Deep Learning Neural Networks, are demonstrating immense potential in data analysis, aiding decision-making, and offering additional advantages including precise demand forecasting, elevated operational efficiency, supply chain optimization, tailored product offerings, and material waste reduction. AI for manufacturing is expected to grow from $1.1 billion in 2020 to $16.7 billion by 2026, an astonishing CAGR of 57 percent.

A key building block for GCC-driven manufacturing in India is the country’s rich talent pool in the AI/ML domain. India already produces 16% of global AI talent, placing it among the top three contributors in the world. The country’s technology workforce grew up in an internet/cloud-first world, and its ability to assemble solutions from combinations of legacy, cloud, and SaaS components is world-class.

Furthermore, to help this growth, India-born CSPs and Hyperscalers have rapidly built the Cloud GPU infrastructure and Machine Learning platforms needed for AI innovation.  This is a crucial piece, as AI and ML technologies rely heavily on advanced Cloud GPUs and Cloud GPU Clusters, which provide the platform needed for training AI algorithms. GCCs are already leveraging this infrastructure, in addition to the incredible talent pool, in order to drive rapid innovation and build on the promise of Industry 4.0.

Additionally, AI in manufacturing in India is poised to be deeply influenced by the Indian government’s keenness to be a key participant in the conversation on AI adoption and regulation at an international level. In the Union Budget of 2023-24, the finance minister called for “Making AI in India and Making AI work for India”. The budget also announced the setting up of three ‘Centres of Excellence’ for research on AI in premier educational institutions. Already, in 2022, the revenue generated through AI in India stood at USD 12 billion in 2022, a number that is expected to grow rapidly over the next decade.

This collaborative effort between GCCs, government policies, and innovative IT companies is driving India’s transition into a global manufacturing powerhouse in an AI and ML-driven era. This collective endeavor not only highlights technological advancement but also presents a holistic vision encompassing policy support, talent nurturing, and global collaboration, positioning India firmly on the global tech stage.

Contributed by Kesava Reddy, Chief Revenue Officer, E2E Networks Ltd

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