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Inside India’s Data Centre Boom: The Winners, the Trends, and the Risks
New Delhi: India is undergoing a once-in-a-generation build-out of digital infrastructure. Investment commitments have already topped $60 billion over the past six years and are on track to cross $100 billion by 2027 — a pace few markets can match.
The New Geography: States Racing Ahead
A state-by-state contest is redrawing India’s server map. Maharashtra, Tamil Nadu, Telangana, Uttar Pradesh, and West Bengal lead in cumulative commitments, driven by coastal cable access, strong power grids, and investor-friendly policies.
Within this network, Mumbai remains the heavyweight, followed by Chennai, Delhi-NCR, and Bengaluru — together accounting for nearly 90% of installed capacity.
An east-coast pole is emerging too. Google and Adani are co-developing a 1 GW AI campus in Visakhapatnam, paired with a new subsea cable landing, which could turn Andhra Pradesh and the Bay of Bengal into the next digital corridor.
Beyond the metros, Greater Noida is scaling up fast with large land parcels and park infrastructure, while West Bengal pitches itself as an eastern hub. Tier-2 and Tier-3 cities are also joining in with edge facilities designed to cut latency and bring workloads closer to users.
The Leaderboard: Who’s in Front
Hyperscalers remain in the lead.
- AWS has committed ₹60,000 crore to expand its Hyderabad region after three previous sites, cementing Telangana’s first-mover advantage.
- Reliance is betting big on scale, planning a 3 GW park in Jamnagar—billed as the world’s largest single-site data centre. Even partial delivery would catapult Jio into the top global tier.
- AdaniConneX is rolling out a multi-city platform and co-developing the Visakhapatnam AI campus with Google, positioning it to rival any domestic player within five years.
Global players are also deepening their roots. Equinix has launched a flagship Chennai facility focused on enterprise interconnection, while NTT is building a 400 MW AI cluster in Hyderabad with Neysa and the Telangana government, targeting 25,000 GPUs for high-performance AI workloads.
Among Indian incumbents, Airtel’s Nxtra continues to expand, emphasizing sustainability with nearly half its energy from renewables. TCS has unveiled a $6.5 billion “sovereign data centre” plan to build 1 GW over seven years — a move that shifts it from tenant to major operator. Real estate players like Anant Raj are joining in, aiming to grow from 28 MW to 307 MW by 2032 using pre-zoned sites with assured power.
Together, AWS and Microsoft will likely dominate cloud demand, while Reliance’s Jamnagar, AdaniConneX’s AI campus, and Nxtra, STT GDC, and Sify form the core of India’s expanding domestic backbone.
Global Context: Catching Up Fast
India still trails the world’s mega-hubs — Northern Virginia alone exceeds the country’s current capacity. But the gap is closing fast. Installed capacity is projected to hit 2,000 MW by 2025 and 4–5 GW by 2030, placing India among Asia-Pacific’s largest markets outside China.
Cost is India’s hidden edge. Building 1 MW of capacity costs a median $6.8 million, versus $11.2 million in Singapore, $9.2 million in Australia, and $12.7 million in Japan. Lower land and construction costs give investors far greater leverage here.
Why Global Tech Is Betting on India
Demand is soaring — fueled by India’s massive internet base, rapid cloud adoption, and early AI workloads. Policy support has improved dramatically: data centres now enjoy “infrastructure status,” the Digital Personal Data Protection Act adds regulatory clarity, and the MeghRaj initiative strengthens government cloud adoption.
States are competing through subsidised land, electricity-duty waivers, and single-window approvals, cutting time to operational readiness. Meanwhile, new submarine cables and renewable power integration are making India both greener and better connected.
The Sustainability Challenge
Data centres — the factories of the digital economy — run non-stop, consuming massive amounts of power and cooling water. AI workloads are raising both demands sharply.
India’s grid is getting greener, but more needs to be done. Pairing each large site with renewable generation and storage from day one is the fastest route to lower emissions. Nxtra, for instance, already sources 49% renewable energy for its core sites.
Water management is another pressure point. Using recycled water, minimizing evaporation, and prioritizing coastal or water-secure locations are becoming industry norms.
Equally critical is grid fairness— ensuring large clusters co-invest in transmission lines and storage to avoid stressing local supply.
The AI Twist: Design and Cooling Innovation
AI changes the physics of data centres. Dense GPU clusters produce far more heat than traditional servers. Indian operators are switching to liquid-cooling and hot-aisle containment systems to handle it.
Sify’s facilities in Chennai, Noida, and Mumbai have earned Nvidia DGX-Ready certification for up to 200 kW per rack — a benchmark for AI-grade infrastructure.
The stakes are high: the IEA warns that global data-centre electricity use could double by 2026 to about 1,000 TWh. For India, keeping growth sustainable will mean strengthening grids, deploying efficient cooling, and recycling water at scale.
Risks to Watch
- Power availability and transmission must keep up with round-the-clock loads.
- Financing is front-loaded and capital-heavy; disciplined execution is key in a higher-interest environment.
- Sustainability norms — on diesel backup, water reuse, and heat recovery — will likely shift from optional to mandatory.
What’s Next: 2025 to 2030
India’s installed capacity — now around 1.25–1.6 GW — is expected to hit 2.07 GW by 2025 and 4.5 GW by 2030, signalling a multi-year construction boom.
Reliance, AdaniConneX, and AWS are the front-runners, while Nxtra, STT GDC, and Sify are fast followers with strong enterprise networks. The next wave — led by TCS and Anant Raj — will expand capacity as modular campuses and power tie-ins become repeatable templates.
India is evolving from a demand-driven market to a regional data hub. With competitive costs, clearer policies, and improving power and fibre, the country is poised to meet its own digital appetite — and serve as a bridge between the Pacific and the Gulf in the global data economy.
