Why Hire From India? 7 Benefits for Global Employers

Quick Summary: 7 Benefits at a Glance

7 Benefits of Hiring Employees from India

India has a vast pool of skilled workers eager to contribute their expertise to global enterprises. Some compelling reasons why you should hire employees from India are listed below:

• Abundance of talent
• Cost-effective labor
• Employer-friendly labor laws
• Technical expertise
• Strong English proficiency and cultural adaptability
• Effective government initiatives to upskill talent and promote entrepreneurship
• Robust infrastructure and internet connectivity

1. Abundance of talent

With a vast population and a thriving education system, the country produces top-notch graduates across various fields, such as IT, finance, and healthcare. For example, approximately 1 million engineering graduates join the tech talent pipeline annually.

Moreover, this rich talent pool offers a wealth of innovative thinking, problem-solving abilities, and a strong work ethic, which can significantly enhance your organization's capabilities, drive innovation, and boost your competitiveness.

With a broad array of candidates to choose from, you can easily fill skill gaps in your organization and build a high-performing team.

2. Cost-effective labor

Hiring talent in India can significantly reduce labor costs compared to hiring in many Western countries. Understanding the full employer of record cost helps you budget accurately for total employment, not just salaries. For example:

• Senior-level developers in India earn an average annual salary of around $40,000, while their counterparts in the US earn more than $115,000 every year
• Indian human resource managers earn between ₹5L – ₹15L/yr (approximately $6,000 – $19,000), significantly lower than the average salary of $85,000 in the US

One common concern about hiring in India is that lower labor costs might imply a lower quality of skill.

However, this is a misconception. India is home to a robust and highly skilled workforce, particularly in the technology sector. Currently, over 1,700 GCCs, including Fortune 500 companies, employ millions of professionals in advanced technology roles. This is a testament to the high quality of talent in India.

3. Employer-friendly labor laws

India's labor laws strike a balance between supporting business operations and protecting workers' rights. In 2026, this framework is being modernized through India's four new Labour Codes, which consolidate 29 existing central labor laws into a simplified structure. The benefits of EOR include having a partner that tracks all these changes automatically: 

• Code on Wages : standardizes minimum wages, payment timelines, and bonus rules
• Industrial Relations Code : governs employment contracts, terminations, and dispute resolution
• Code on Social Security : covers Provident Fund, ESI, gratuity, and benefits for gig and platform workers
• Occupational Safety, Health and Working Conditions (OSH) Code : sets standards for working hours, leave, and workplace safety

For employers hiring in India in 2026, these codes reduce regulatory fragmentation and create a more predictable compliance environment. They maintain high standards on employment security, fair wages, and working hours, helping protect workers while giving employers clearer rules to follow.

Businesses can also operate in Special Economic Zones (SEZs), which offer various incentives, including simplified regulatory procedures and tax benefits. This makes it easier to establish and operate businesses while remaining compliant with labor laws.

4. Technical expertise

India's workforce stands out globally for its technical expertise, driven by the country's exceptional education system in science, technology, engineering, and mathematics (STEM) fields. 

For example, there are over 5 million software developers in India, and the country ranks first in AI skill penetration, possessing expertise in cutting-edge technologies like machine learning and natural language processing.

This abundance of technical expertise positions India as a valuable source of skilled labor for companies seeking to build or augment their technological capabilities, whether in software development, data science, engineering, or scientific research.

5. Strong English proficiency and cultural adaptability

Despite being multicultural and multilingual, India is the world's second-largest English-speaking country, with approximately 10% of the population speaking English.

Since English is widely spoken and used as a medium of instruction in many educational institutions, this enables seamless communication with international teams.

Furthermore, the presence of many global corporations in the country exposes Indian talent to cross-cultural work environments, enabling them to adapt and thrive in international settings.

6. Effective government initiatives to upskill talent and promote entrepreneurship

The Indian government has implemented various policies and initiatives to encourage foreign investment and promote entrepreneurship, including incentives for setting up operations and favorable tax regimes.

Since 2016, the Indian government has enacted 53 regulatory reforms to boost the startup ecosystem. As a result, India's startup ecosystem now includes more than 125 unicorns as of 2026, with a combined valuation in the hundreds of billions of dollars, according to industry trackers such as Inc42 and Invest India.

Recently, the government also relaxed FDI (foreign direct investment) rules to allow 100% foreign direct investment in the procurement and manufacture of satellite systems. India also continues to rank among the top global recipients of FDI, based on the latest UNCTAD World Investment Report.

7. Robust infrastructure and internet connectivity

India has made significant strides in providing stable power supply and reliable internet infrastructure across the country, including tier 2 and tier 3 cities. This widespread availability of power and high-speed internet connectivity ensures uninterrupted operations and seamless remote collaboration, regardless of location. Indian employees can work efficiently without facing connectivity issues, which translates to increased productivity and reliable service delivery.

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Top Sectors to Hire Employees from India  

Understanding the top sectors for hiring employees from India can help businesses tap into this rich talent pool and drive growth and innovation. Here are some of the key sectors worth considering:

1. AI & ML Engineers

India has emerged as a global leader in artificial intelligence and machine learning talent. The country ranks first in AI skill penetration globally, with a rapidly growing pool of professionals specializing in:

• Machine learning algorithms and model development
• Deep learning and neural networks
• Natural language processing (NLP)
• Computer vision and image recognition
• AI-powered automation and intelligent systems

With strong STEM education and exposure to cutting-edge technologies, Indian AI and ML engineers are driving innovation across industries, from healthcare and finance to manufacturing and e-commerce. The combination of technical expertise and cost-effectiveness makes India an ideal destination for companies looking to build AI capabilities.

2. Tech

India is renowned for its IT industry, with a wealth of skilled professionals in software development, cybersecurity, cloud computing, data analytics, and more. According to IBEF, the Indian IT and software industry continues to grow strongly, with the sector projected to expand significantly through 2030. Major global firms have also scaled their India workforce considerably, with Accenture's India headcount now well above 300,000, making it the company's largest country workforce.

The country's strong education system, IT infrastructure, English proficiency, and cost-effectiveness make it an attractive destination for IT outsourcing and talent acquisition.

3. Healthcare

India's healthcare sector is expanding rapidly, with significant advancements in pharmaceuticals, medical research, and healthcare services.

This country is easily becoming a major source of healthcare talent for Europe and the Gulf region. Also, there is a growing demand for Indian nurses in countries like Malaysia, Italy, Portugal, Poland, and Germany. The nursing talent pool in India is expected to increase dramatically, with projections indicating 100-fold growth in the next five years.

4. Telecommunications

India's telecommunications sector is one of the fastest-growing industries, driven by a massive and tech-savvy population. The rapid expansion of 4G and 5G networks, coupled with the government's Digital India initiative, has further spurred growth in this sector. According to a Canalys report, continued government support for domestic manufacturing, including battery charger production, is expected to drive new factory setups and create hundreds of thousands of additional jobs across the sector through 2026 and beyond.

This creates job opportunities for network engineers, telecommunications technicians, software developers, and data analysts, among others.

5. E-commerce and retail

India’s e-commerce and retail sectors are booming, driven by increased internet penetration, rising disposable incomes, and a growing middle class.

E-commerce is experiencing exponential growth and is projected to reach Rs 26 trillion by 2030 from its current market size of Rs 8.2 trillion.

Retailers continue to open more stores, with many well-known organizations actively expanding their presence. Also, significant growth and expansion are expected to occur in tier-2 and tier-3 cities, highlighting the ongoing potential in these markets. Plus, this industry offers diverse career opportunities for professionals with varying skills and expertise, including website designers, SEO analysts, copywriters, marketing specialists, and IT technicians.

Does Cost Vary by Location and Role Seniority in India?

Salaries in Bangalore, Mumbai, and Delhi-NCR run 30% to 45% higher than tier 2 cities for the same role. The national averages cited in this guide reflect a blended figure across all India locations. Role seniority amplifies the gap. Senior roles show larger city-tier premiums than entry or mid-level positions. Budget based on where your candidate is located, not the national average alone. 

Gloroots covers all India locations under the same employer of record pricing model. Whether you hire in Bangalore or Ahmedabad, statutory employer obligations and the Gloroots fee remain consistent. 

Use the Gloroots Salary Calculator to model total cost by role and location before your first hire.

How to Compliantly Hire Employees from India

Follow these steps to compliantly hire employees in India:

1. Understand Indian labor laws

Indian employment and labor laws are complex, with unique state regulations in addition to national laws.  For example, in India, it's customary for new hires to sign an employment contract. While federal labor law doesn't mandate written contracts, states like Karnataka and Delhi have legal requirements for employees to have written contracts.     

Familiarize yourselves with these laws and stay updated on any changes to ensure global compliance.

2. Establish a legal entity

Setting up a legal entity from scratch typically involves registering with local authorities, opening a local bank account, and consulting with local experts to ensure compliance with tax and labor laws. 

If you decide to establish a legal entity, you need to register your company with the Ministry of Corporate Affairs (MCA). This includes obtaining a Director Identification Number (DIN), a Digital Signature Certificate (DSC), and filing the necessary incorporation forms. Also, register for Goods and Services Tax (GST), Employee State Insurance (ESI), and Provident Fund (PF) as applicable.

However, establishing a legal entity in India can be time-consuming and complex. Using an employer of record in India can simplify this process. An EOR acts as the legal employer on your behalf, handling HR, payroll, compliance, and other administrative tasks. 

3. Draft employment contracts

Ensure that employment contracts comply with Indian labor laws. Contracts should include a job description, compensation details, working hours, leave entitlements, termination conditions, and other relevant terms.

4. Ensure fair employment practices

Avoid discrimination based on gender, religion, caste, or any other protected characteristic, and ensure that your hiring process is merit-based and transparent.

5. Determine appropriate compensation

Research and determine competitive compensation packages based on industry standards and local market conditions in India. Take into account factors such as cost of living, skills required, and level of experience.

Use the Gloroots Salary Calculator to estimate salaries for hiring Indian employees across various sectors and plan your budget accordingly.

6. Hire contractors to test the labor market

Before committing to hiring full-time employees, you can hire international contractors or freelancers to test the labor market in India. This allows you to assess the quality of talent available and the suitability of your business model in the Indian market before making long-term commitments. Review the EOR vs contractor comparison before deciding on the engagement structure. 

For longer-term arrangements, employer of record for independent contractors provides a compliant structure that protects both parties.

7. Partner with an EOR

Partnering with an Employer of Record (EOR) to onboard professionals from India can help you navigate the complexities of Indian employment laws. An EOR handles payroll, taxes, and benefits administration, ensuring compliance with local regulations. This option is especially beneficial if you are not familiar with the Indian legal and business environment or lack the resources to manage a global payroll efficiently using modern employer of record software. Review the pros and cons of employer of record to determine if EOR is the right model for your India hiring plan.  

Hire Employees from India Using Gloroots

Hiring employees from India can unlock access to a vast, highly skilled talent pool, but navigating local hiring regulations, payroll structures, and compliance requirements can be complex. Gloroots simplifies this process by managing international hiring in India end-to-end, so you do not need to coordinate multiple vendors, interpret local labor laws, or manage administrative workflows internally.

With Gloroots, the entire hiring lifecycle in India is handled through a single, compliant, and streamlined process. From talent identification to onboarding and ongoing payroll management, every step is executed in alignment with Indian labor regulations.

How Gloroots Manages End-to-End Hiring in India:

Gloroots runs the complete hiring workflow for Indian employees, including:

• Candidate sourcing, shortlisting, and background verification using local market expertise
• Initial screening to assess role fit, technical skills, and experience levels
• Interview coordination and hiring support to streamline selection
• Offer issuance with locally compliant employment contracts
• Employer of Record (EOR) setup to legally employ talent without entity formation
• Statutory registrations, payroll configuration, and tax compliance
• Mandatory benefits administration, including Provident Fund (PF), Employee State Insurance (ESI), gratuity, and leave entitlements
• Employee onboarding aligned with Indian labor laws and employment standards
  
  

By acting as the legal employer on your behalf, Gloroots ensures full compliance with both central and state-level regulations in India. Payroll is processed accurately in local currency, statutory contributions are calculated correctly, and filings are handled on time, reducing compliance risk and administrative overhead.

Whether you are hiring your first employee in India or scaling a distributed team, Gloroots allows you to focus on team growth and performance while global hiring execution, compliance, and onboarding are handled seamlessly from start to finish.

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From software engineers and AI specialists to finance and operations professionals, Gloroots helps you hire, pay, and manage employees across India without entity setup. Focus on growth. We'll handle compliance, payroll, and HR administration.
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FAQs

1. What is the average cost of hiring an employee in India? 

The average cost varies significantly by role, seniority, and city tier across India. Senior developers earn around $40,000 per year nationally, while HR managers earn $6,000 to $19,000. Total employer costs, including PF, ESI, gratuity, and mandatory leave, typically run 1.25 to 1.4 times the base salary. 

2. Do I need to establish a legal entity to hire employees in India? 

No. You can hire Indian employees without a local entity by working with an employer of record. An EOR acts as the legal employer, managing contracts, payroll, PF, ESI, and statutory compliance on your behalf. This eliminates the 2 to 3 month entity setup timeline and ongoing administrative overhead. Review the benefits of EOR to understand what an EOR covers. 

3. How long does it take to hire an employee in India? 

With Gloroots as your employer of record, Indian employees can be onboarded within days of offer acceptance. Setting up a local entity typically takes 2 to 3 months before you can make your first hire. 

Direct hiring through traditional channels can extend several weeks, depending on the role and compliance requirements. 

4. What are the mandatory benefits for employees in India? 

Mandatory benefits include Provident Fund (PF), Employee State Insurance (ESI), and gratuity for employees with five or more years of service. Statutory leave entitlements also apply, including earned leave, sick leave, and casual leave, which vary by state. Specific thresholds depend on company size and employee salary levels. An EOR tracks and manages all obligations automatically. 

5. Can I hire remote workers in India without a physical office? 

Yes. An employer of record enables you to hire remote workers across India without a physical office or local entity. Indian employees can work from metro cities or tier 2 and tier 3 locations, all with strong digital infrastructure. 

Gloroots extends the same model to employer of record in Singapore and 150+ other countries, under consistent pricing. 

6. Is hiring from India legal for US and UK companies in 2026? 

Yes. US and UK companies can legally hire in India in 2026 through a local entity or an employer of record. An EOR issues compliant employment contracts, runs payroll in INR, and manages PF, ESI, and gratuity on behalf of the foreign employer. This keeps employment aligned with both central and state-level labor laws without establishing a subsidiary. 

7. What is the impact of India's new Labour Codes on hiring in 2026? 

India's four new Labour Codes consolidate 29 central labor laws into a more predictable compliance framework for all employers. The codes standardize rules on wages, working hours, contracts, terminations, and social security contributions across central and state levels. Social security coverage now extends to gig and platform workers, reducing misclassification risk for companies that rely on contractor arrangements. The pros and cons of employer of record become clearer under this consolidated framework.