(Commonwealth_India) India’s data center market has witnessed remarkable growth, attracting over US$60 billion in investment commitments from global operators, real estate developers, and private equity funds in just the past six years. CBRE South Asia’s latest 2024 India Data Centre Market Update report predicts that the market’s total investment inflow will surpass US$100 billion by 2027.
The data center sector in India has become an attractive destination for both domestic and international investors due to the country’s increasing digital consumption, supportive government policies, and rapid digital transformation in various industries. India saw substantial investment between 2019 and 2024, with total commitments surpassing US$60 billion, a trend we expect to continue.
Key states leading in data center investments include Maharashtra, Tamil Nadu, Telangana, Uttar Pradesh, and West Bengal. These regions have emerged as major hubs for data center development, with each state offering specific advantages such as favourable policies and robust infrastructure. As per CBRE’s report, India is on track to surpass US$100 billion in investment commitments by 2027.
Anshuman Magazine, Chairman & CEO of CBRE India, South-East Asia, Middle East & Africa, highlighted that the country’s data center market is primarily driven by demand from sectors like banking, financial services, insurance (BFSI), technology, and telecommunications. These sectors, combined with state-level incentives, are anticipated to continue fuelling the expansion of the data center market in India. The magazine also emphasized that the sector’s growth will solidify India’s position as one of the most appealing destinations for data center operators in the coming years.
India’s data center capacity is projected to reach 2,070 MW by 2025, up from around 1,255 MW currently. By the end of 2024, the country’s capacity is expected to rise to approximately 1,600 MW. Mumbai continues to dominate the data center stock, followed by Chennai, Delhi-NCR, and Bengaluru, which together account for 90% of India’s total data center capacity as of September 2024.
The accelerating digital transformation, increased internet penetration, and the surge in data generation—especially due to artificial intelligence (AI)—are expected to drive further growth in the sector. Moreover, the Indian government’s efforts to support the industry, including granting infrastructure status to data centers and implementing favorable policies, have played a critical role in fostering a positive environment for development.
Furthermore, the enactment of the Digital Personal Data Protection Act (DPDPA) in 2023 has played a significant role in fostering stakeholder trust and securing the legitimacy of cross-border data processing and trade. These factors, combined with India’s expanding digital ecosystem, position the country as a key player in the global data center market, poised for continued growth and investment.
