Offshoring Potential: India Takes Centre Stage

India has emerged as a powerhouse in the global offshoring landscape. In 2023, the Indian offshoring market accounted for a staggering 46% of the country's office space leasing, a testament to its growing prominence. The offshoring sector in India has witnessed a remarkable surge, with leasing volumes soaring by 26% compared to the previous year, reaching a substantial 27.3 million sqft.

A recent report unveiled by Knight Frank, titled ‘Asia Pacific Horizon: Harnessing the Potential of Offshoring’, underscores India's pivotal role as one of the leading offshoring destinations worldwide, with its burgeoning offshoring market reshaping the country's office real estate dynamics.

Key players in the offshoring space, particularly Global Capability Centres (GCCs), have been instrumental in driving this growth trajectory. GCCs, encompassing diverse industries, emerged as the primary offshoring occupiers, spearheading India's offshoring narrative. Notably, the GCC landscape in India expanded significantly in 2023, boasting over 1,580 centres across the nation.

While Information Technology continues to dominate as the leading GCC occupier, India's offshoring surge was fuelled by a notable influx of GCCs from the industrial sector. Industries such as semiconductors, automobiles, and pharmaceuticals capitalized on India's conducive business environment, securing large office spaces to leverage unique growth opportunities.

The rise of offshoring isn't merely a trend, it’s a transformative force reshaping the office demand landscape across the Asia-Pacific region. Global companies increasingly view offshoring as a strategic imperative to drive cost efficiencies, propelling demand for office spaces in key offshoring hubs including India, the Philippines, Malaysia, and Vietnam.

India's offshoring prowess isn't just confined to the present; it's poised for exponential growth in the coming years. India's IT service exports are expected to surge from USD 185.5 billion in 2023 to USD 230.5 billion by 2025. With a steady influx of additional commercial assets, India's office market is slated to expand significantly, reaching an estimated one billion square feet by 2025.

As India continues to solidify its position as a global offshoring hub, the report illuminates the pivotal shifts and opportunities shaping the offshoring landscape, reaffirming India's status as a beacon of offshoring excellence in the Asia-Pacific region.