The 36-year-old had two spells with Atletico Madrid – joint owners of the Kolkata franchise – either side of a three-year spell with Liverpool where he won the FA Cup, the UEFA Champions League and the European Super Cup.
The former Spain international had announced his retirement from football earlier this year after spending two seasons playing in Mexico, but confirmed his participation in the Super League via his twitter account.
“I'm very excited to share with you my new challenge. I've decided to join Atlético de Kolkata,” Garcia tweeted.
The Indian Super League, which is set to run for two months beginning in September, will feature eight franchises and is the brainchild of the All India Football Federation and its marketing partner IMG-Reliance.
Each franchise is allowed one marquee player and FA Licensed agent Baljit Rihal of Inventive Sports believes Garcia’s arrival is the beginning of an exciting period in India’s football history.
“I think it’s a really important step for Indian football and more so because of Garcia’s links with Atletico Madrid,” the Asian Football Awards founder told Sky Sports.
“It’s also a really big statement of intent from the organisers because of the he fact he is also an ex- Liverpool player and Liverpool FC are very big in India.
“Being a Champions League winner himself makes this move huge because Champions League viewing figures in India run into the tens of millions and Garcia is a name that Indian football fans know.
“I think the announcement of further marquee players is imminent and I think there may well be some even higher profile names than Garcia.
“Robert Pires, Robbie Fowler, Hernan Crespo and Michael Chopra are the sorts of names that have been floating about.
“Garcia wasn’t even in the mix earlier and there is a lot more to come but I wouldn’t be surprised to see some high-profile players come that haven’t even been linked.”
Atletico de Kolkata have also confirmed former Bolivia national team boss Jose Antonio Habas will manage the club, which counts former India Test captain Sourav Ganguly as one of its owners.
Ganguly added: “Atletico de Kolkata is all set to epitomise core Bengali values and philosophy and provide the platform to nurture the raw talent available all across this state which produced some of the country’s best footballers in the past.
"We will strive to showcase the finest quality of football synonymous to an iconic club like Atletico de Madrid.”