5 months ago
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More logistics firms are looking at Tamil Nadu to set up their Global Capability Centres (GCCs).
Firms such as CMA CGM, DHL, Maersk, and Mediterranean Shipping Company already have their GCCs in the State. In 2023, two firms — Hapag Lloyd and United Parcel Service (UPS) — entered Tamil Nadu. It is learnt that more logistics GCCs are eyeing Chennai now.
According to details shared by Guidance, the nodal agency instrumental in bringing investments into the State, Chennai – which is situated strategically along the east coast – offers excellent connectivity through ports, airports, rail and road networks. The presence of high-calibre tech talent, a favourable ecosystem and global logistics companies collectively position Tamil Nadu as an optimal choice for setting up GCCs.
These GCCs have presence in locations such as Ambattur, Thoraipakkam, Perungudi and Porur. The centres are developing innovative software solutions for maritime industry, and work in advanced technologies such as AI and robotics. Jerry Kingsley, Head–Strategic Consulting & Value & Risk Advisory India, Jones Lang LaSalle, said: “Chennai is the largest logistics GCC hub of the country.. with top 5-6 global logistics and shipping players having a combined portfolio of above 500K sq ft occupancy in Chennai.”
Subramani Ramakrishnan, vice-president, UPS Technology centres in India, said: “The decision to establish our first technology centre in Chennai was guided by three considerations — opportunity, business needs and talent requirements. With some of the best educational institutions in the country, there is no shortage of talent in Chennai.”
UPS had recently signed an MoU with the Chennai Institute of Technology to drive academic and research initiatives.Vikash Agarwal, Managing Director, Maersk South Asia, said Chennai provided a conducive environment for GCCs and a supportive ecosystem. “Our involvement with Tamil Nadu is not limited to our commercial business in shipping and logistics. We have a very strong Global Service Centre in Tamil Nadu that employs over 3,700 persons in global functions and supporting technology capabilities,” he added.Ramkumar Ramamoorthy, Partner Catalincs, who has been tracking the GCC sector in Tamil Nadu said: “Decades of deep capabilities across port logistics, manufacturing and technology has attracted some of the biggest names in global supply chain to set up their GCCs in Chennai. This includes three of the five largest container shipping companies, Mediterranean Shipping Company, Maersk and Hapag-Lloyd, and multi-modal players such as DHL, UPS and Expeditors...”
He further said: “While the earlier GCCs started with business process management and transitioned to technology services, the newer ones have embraced the city for deep digital capabilities, specifically data analytics and AI, to help re-imagine their business, financial and operating models.”He, however, said a lot more was needed on the academic front.
“We need to shape talent at a massive scale. While some efforts have been taken through the Naan Mudhalvan programme, the government can also work closely with the Madras Chamber of Commerce and Industry and Confederation of Indian Industry, which have decades of experience in curating logistics programs for students and working professionals, leveraging the deep expertise of its members. These courses need to be embedded into the curriculum with credit equivalence across colleges in the State to create talent at scale.”
The GCC guide 2023, published by one Lang LaSalle, said the current pre-commitment for the forecast supply till 2023 stands at 10 mn sq ft and Chennai has the highest share in terms of GCC occupiers. According to details in the guide, Chennai has proved its mettle with GCCs that operate in multiple sectors, including IT/ITeS, BFSI and Engineering Research & Development ER&D (Manufacturing and Industrial).
