What is the practical use of a GRE tunnel in the above scenario?
A VPN Tunnel is basically a tool to run private networks over public infrastructure which is what will happen in your scenario. The simple answer in your case is that you hide your LAN subnets and the ISP's are not aware of it and you can your private IP's over public space. Also you control your LAN routing.
What are the pros and cons of GRE tunnel over IPSEC tunnel
You can run routing protocols over GRE Tunnels. GRE Tunnels support multicast traffic.etc With IPsec you can't do this. However, there is an exception whereby you can create something called VTI interfaces and run IPsec and Routing protocols over it. But natively, IPsec doesnt support routing protocols.
GRE traffic is not encrypted so a hacker can easily spoof your traffic and cause potential securtiy threat. whereas IPSec traffic is encrypted
Geneally speaking , when running GRE across the public space its best to run GRE over IPsec and you can gain the best of both worlds.
There are other stuff as well but I gave you the most common info that you would need to know
below link also gives you some good FAQ about both protocols
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Yes, you could do that with a GRE tunnel, although it's possible to do local Internet per branch directly without passing such traffic through the GRE tunnel. For the latter, only internal business traffic would pass via the GRE tunnel.
"Normal" GRE tunnels are p2p which means either traffic between branches need a dedicated tunnel or will transit another site or sites, often a HQ hub. There also multipoint GRE which allows multiple sites to logically be on the same network. One variation of this will have all traffic physically transit a hub site, but there's also a variation that can build a dynamic GRE tunnel between branches and pass traffic directly between them.
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