Indian Economy News

India will see US$ 18 billion (Rs. 1.5 trillion) worth of investment in data centres in the next six years

  • IBEF
  • February 22, 2023

As per a report, India is expected to witness 4,900-5,000 megawatts (MW) of capacity with an investment of US$ 18 billion (Rs. 1.5 trillion) in the next six years.

The industry revenues are expected to increase at a compounded annual growth rate (CAGR) of around 17-19% during FY23-FY25, supported by an increase in capacity utilisation and ramp-up of new data centres, according to credit rating agency Investment Information and Credit Rating Agency of India Limited (ICRA).

Indian corporations like the Hiranandani Group, the Adani Group (in a joint venture with EdgeConnex), and the Reliance Group, as well as foreign investors like Blackstone, CapitaLand, Princeton Digital Group (PDG), and big tech companies like Amazon and Microsoft, have begun to invest heavily in data centres in the nation to meet the growing demand.

Mr. Anupama Reddy, Vice President and Co-Group Head, Corporate Ratings, ICRA expects the sector to witness a six-fold increase in capacities in the next six years, with Mumbai, Hyderabad, and Delhi-NCR to account for 70-75% of the installed DC capacity.

Mumbai and Chennai have maximum landing stations, with the former being the preferred location for a data centre operator. The other key emerging locations are Hyderabad and Pune, wherein some of the large hyper scalers are setting up huge data centres closer to their operational bases in India

The government's focus on e-governance and digital India, the adoption of new technologies (Cloud computing, IoT, and 5G, etc.), and the rising user base for social media, gaming, e-commerce, and over-the-top (OTT) platforms are the main causes of India's digital explosion.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.