Global Companies Expand In-House Operations in India as AI Reduces Outsourcing Dependence
Global companies are increasingly shifting critical operations to their India-based centres as artificial intelligence improves productivity and reduces dependence on outsourcing vendors, executives said at a Reuters summit in Bengaluru. The trend marks a strategic shift from India serving mainly as a low-cost support base to becoming a hub for core functions such as engineering, analytics and product development.
Companies including Daimler Truck, Target and IBM said they are increasingly handling high-value work internally. Daimler Truck’s Bengaluru innovation centre is now developing key vehicle software and safety-related algorithms in-house, while Target said most of its technology work in India is already managed by internal teams rather than external partners.
AI-driven efficiency is also allowing firms to scale operations without significantly increasing headcount. Novo Nordisk said its Bengaluru centre now contributes extensively to global drug launches, while Workday noted that India teams are taking responsibility for complete product delivery. Executives said outsourcing will continue, but mainly for specialised tasks and short-term flexibility, as companies prioritise greater control, speed and integration through their in-house India operations.
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