Data Centre Market in India
Pre-2016: Limited Data Centre (DC) activity and development in India before dedicated state-level policies.
2016: Telangana becomes an early adopter with a dedicated DC policy, indicating initial focus on the sector.
2019 - 2024: Significant investment in Indian DC market. Estimated at USD 60 billion.
2020: Draft Data Centre Policy formulated by the Indian government, creating a favorable environment. Good Governance Index recognizes the states that are most business-friendly.
2021: Several states including Uttar Pradesh, Tamil Nadu, and West Bengal introduce their own DC policies.
2022: Haryana and Karnataka implement state-specific DC policies.
2023: The Digital Personal Data Protection Act (DPDPA) implemented, boosting cross-border data trade. Maharashtra releases its IT policy, including Data Center incentives.
End of 2024: Total DC capacity in India is projected to reach approximately 1,600 MW (~24 million sq. ft.).
2025: DC capacity is projected to increase to ~2,070 MW (~31 million sq. ft.). Mumbai, Chennai, and Delhi-NCR expected to lead new supply additions. BFSI and Technology sectors expected to drive demand.
2027: Cumulative investment in the Indian DC sector is anticipated to exceed USD 100 billion.
Key Trends and Developments:
Growth Drivers: Digital transformation, increased internet penetration, policy enablers, rising data consumption, 5G deployment, and AI adoption are fuelling market growth.
Sustainability: Growing focus on renewable energy and energy efficiency in data centres to reduce carbon footprint.
AI Impact: Rise of AI and HPC is driving demand for higher power densities and advanced cooling solutions. GenAI is expected to create demand similar to cloud computing.
Investment: Significant investments from global operators, real estate developers and private equity funds, with Maharashtra and Tamil Nadu leading in investment commitments.
State Policies: Several states have introduced dedicated policies and incentives to attract investments.
Market Leaders: Mumbai and Chennai are the dominant DC markets in India. Other emerging markets include Delhi-NCR, Hyderabad, Bengaluru, and Pune.
Occupiers: Technology companies, BFSI firms, OTT platforms, social media, hyperscalers, and public sector undertakings are primary DC occupiers.
Future Trends: Shift to colocation DCs, rise of hyperconverged infrastructure (HCI), liquid immersion cooling, and a growing focus on sustainability are expected.
Government Support: Government initiatives like the IndiaAI mission are bolstering the AI sector and data centre growth.
Cast of Characters (Principle People Mentioned):
Pre-2016: Limited Data Centre (DC) activity and development in India before dedicated state-level policies.
2016: Telangana becomes an early adopter with a dedicated DC policy, indicating initial focus on the sector.
2019 - 2024: Significant investment in Indian DC market. Estimated at USD 60 billion.
2020: Draft Data Centre Policy formulated by the Indian government, creating a favorable environment. Good Governance Index recognizes the states that are most business-friendly.
2021: Several states including Uttar Pradesh, Tamil Nadu, and West Bengal introduce their own DC policies.
2022: Haryana and Karnataka implement state-specific DC policies.
2023: The Digital Personal Data Protection Act (DPDPA) implemented, boosting cross-border data trade. Maharashtra releases its IT policy, including Data Center incentives.
2023-2030: Generative AI sector in India projected to grow at a CAGR of 28%, significantly increasing demand for data centres.May 2024: Microsoft-LinkedIn release the 2024 Work Trend Index Annual Report. EY publishes report on the potential of Gen AI in India.
Jan-Sep 2024 (9M 2024): Total DC capacity in India reaches approximately 1,255 MW (~19 million sq. ft). Mumbai accounts for 49% of the total DC stock in India. Overall DC occupancy in India is at 75-80%.
End of 2024: Total DC capacity in India is projected to reach approximately 1,600 MW (~24 million sq. ft.).
2025: DC capacity is projected to increase to ~2,070 MW (~31 million sq. ft.). Mumbai, Chennai, and Delhi-NCR expected to lead new supply additions. BFSI and Technology sectors expected to drive demand.
2027: Cumulative investment in the Indian DC sector is anticipated to exceed USD 100 billion.
Key Trends and Developments:
Growth Drivers: Digital transformation, increased internet penetration, policy enablers, rising data consumption, 5G deployment, and AI adoption are fuelling market growth.
Sustainability: Growing focus on renewable energy and energy efficiency in data centres to reduce carbon footprint.
AI Impact: Rise of AI and HPC is driving demand for higher power densities and advanced cooling solutions. GenAI is expected to create demand similar to cloud computing.
Investment: Significant investments from global operators, real estate developers and private equity funds, with Maharashtra and Tamil Nadu leading in investment commitments.
State Policies: Several states have introduced dedicated policies and incentives to attract investments.
Market Leaders: Mumbai and Chennai are the dominant DC markets in India. Other emerging markets include Delhi-NCR, Hyderabad, Bengaluru, and Pune.
Occupiers: Technology companies, BFSI firms, OTT platforms, social media, hyperscalers, and public sector undertakings are primary DC occupiers.
Future Trends: Shift to colocation DCs, rise of hyperconverged infrastructure (HCI), liquid immersion cooling, and a growing focus on sustainability are expected.
Government Support: Government initiatives like the IndiaAI mission are bolstering the AI sector and data centre growth.
Cast of Characters (Principle People Mentioned):