Global Capability Centers: Key Hotspots and India’s Rise as the GCC Capital

PROS: • Robust Free Trade Agreements (FTAs) with North America and European Union • Guadalajara is known to be the tech capital of Mexico with high concentration of talent around Software development, Web design, and R&D. • Similar time zone to most destinations in the USA and Canada. • Known globally for its good quality education in computer science. • Flying to Mexico from USA is easy with several hundred flights daily, thereby making it a nearshoring destination. • Mexico is now biggest merchandise trade partner of USA post weakening of US-China relations. PROS: • The capital city of San Jose hosts numerous large technology • enterprises and R&D centers • Costa Rica’s central time zone seamlessly synchronizes with many cities in the US. • Costa Rica is known to be a political stable and democratic country • World Economic Forum: Costa Rican workforce is top human capital in LATAM • Education is affordable and often focuses on STEM fields • Services such as BPO, customer support, IT outsourcing, etc., accounts for ~50% of Costa Rica’s exports.t weakening of US-China relations. Poland has a significant IT workforce within CEE region, with over 400k software developers compared to 200k in Ukraine and 80k in Hungary. • Poland has 14 major SEZs where investors receive tax incentives to promote technology sector. • All the EU member states, Poland included, subscribe to the same IT offshoring regulations. • General Data Protection Regulation (GDPR) is central regulation in EU for IT offshoring weakening of US-China relations. PROS: • Poland has negligible time difference with European countries. •

CONS: • Mexico’s major weakness is its political & regulatory stability and rule of law framework. • Need for more incentives to entrepreneurs and start-ups, and for firms to file IP trademarks and patents. • Relative lack of venture capital deals in Mexico. • Mexico’s tax laws are bit complex • Salaries in Mexico higher than offshoring locations in rest of LATAM or South Asia.

Mexico

Costa Rica

CONS: •

Complex tax systems

• Few cities have slightly relaxed approach to deadlines • Few cities in Costa Rica may face language barrier issues • Ensuring compliance with international laws on data security and IP can be complex • Costa Rica is a small country, and so the number of skilled soft ware developers or programmers is low

Poland

CONS: •

Risks to political stability is elevated owing to coalition’s diverse ideologies, although it is expected that the new government will last its full term until 2027 • Labour costs are relatively low compared to European counter parts, but high when compared to India and China

India

PROS: •

CONS: • Relatively weak IP or trademark protection laws compared to some comparable nations • Indian tax systems, though improving, can be complicated for certain multinationals. • Ranks 63rd in ease of doing business while Poland ranks 40th

Highest STEM graduates in the world, after China

• Risks to political stability is limited owing to high domestic approval rating of current prime minister. • World’s largest ICT exporter, helping it position itself as an attractive tech ecosystem. • Cost of skilled labor is amongst lowest globally • English is considered as first language for business • World’s third largest start-up ecosystem, thereby attracting massive VC deals every year. • eakening of US-China relations.

Philippines

PROS: •

CONS: • While competitive, navigating tax regulations may be complex for foreign corporations • Intellectual property rights / protection is improving but faces challenges • Talent pool in specialized STEM fields may be smaller compared to countries such as India

Philippines ranks as third-largest English-speaking country worldwide; 95% of population is able to speak in English. • Philippines authorities ensure protection of every individual and business through the Data Privacy Act, 2012 • The Special Economic Zone Act oversees foreign investments such as BPO and promotes them inside special economic zones. • Philippines currently enjoys a stable political environment, following a history of authoritarian rule, uprisings, and coup attempts. •

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GLOBAL CAPABILITY CENTERS:

Key Hotspots and India’s Rise as the GCC Capital