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With robust data centre (DC) demand fueling expansion into India’s digital infrastructure, investment commitments in the industry are expected to surpass USD 100 billion by the end of 2027, according to CBRE report.
India’s Data Centre (DC) market is witnessing a surge in investment activity, with Maharashtra and Tamil Nadu emerging as the most preferred destinations.
India’s data centre market has emerged as a magnet for global and domestic investors, attracting nearly USD 60 billion in investment commitments between 2019 and 2024.
Mumbai, which accounts for 49 per cent of India’s total DC stock, continues to dominate the market, followed closely by Chennai, Delhi-NCR, and Bengaluru. Together, these Tier-I cities constituted about 90 per cent of the country’s DC stock in the January-September 2024 period.
Mumbai and Chennai’s stronghold is bolstered by their strategic infrastructure, including multiple cable landing stations, government support, and established financial industries, making them prime hubs for BFSI, cloud, hyperscale, and OTT companies.
India’s DC stock stood at approximately 1,255 MW (~19 million sq. ft.) as of September 2024 and is projected to grow to around 1,600 MW (~24 million sq. ft.) by the end of the year.
In 2025, an additional 475 MW of capacity is under construction, with Mumbai and Chennai expected to lead the supply additions.
Demand from technology firms, BFSI, fintech, and media sectors, along with public sector undertakings, is expected to further boost occupancy rates, which currently stand at 75-80 per cent.
India’s generative AI sector is forecasted to grow at a compound annual growth rate (CAGR) of 28 per cent from 2023 to 2030, contributing significantly to DC demand.
The adoption of generative AI is projected to add USD 400 billion to India’s economy by 2030, underscoring the importance of robust digital infrastructure.
State-level incentives have played a pivotal role in attracting DC investments. Maharashtra, Tamil Nadu, and Telangana were among the first to introduce dedicated policies, defining DCs as an “essential service” and offering extensive infrastructure support.
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