India data centre market to more than double to $22 billion by 2030

Bengaluru: Rising Artificial Intelligence (AI) adoption, increasing demand for cloud infrastructure, and the rapid growth of digital platforms are expected to drive the next wave of growth in the country's data centre market, as it is projected to reach 22 billion dollars by 2030 from 10 billion dollars in 2025.

According to Vestian, a workplace solutions firm, installed capacity is expected to expand from around 1.7-2.0 GW by end-2026 to about 4-5 GW by 2030, backed by nearly 30 billion dollars in cumulative investments.

It said Mumbai is likely to dominate the market with over half of the country's operational capacity, supported by strong subsea cable connectivity, an established ecosystem, and strong hyperscale interest.

The report also said that Bengaluru, Hyderabad and Pune are expanding as key secondary growth markets. Tier-II cities are also gradually emerging, and operational capacity in these markets is currently estimated at 60–80 MW, and is expected to exceed 100 MW by the end of this year.

It mentioned that the data centre sector witnessed robust investments in India, with about 13-15 billion dollars deployed between 2020 and 2024, supported by around 80 per cent participation from foreign institutional investors.

The sector has announced an investment pipeline of nearly 60-70 billion dollars over the next five years, with joint venture-led platforms playing a key role in accelerating hyperscale campus development and capacity expansion across major markets.

Shrinivas Rao, FRICS, CEO, Vestian, said, "India's data centre sector is rapidly transforming on the back of strong policy support and rising digital demand. Despite a limited share of global capacity, India has a huge upside potential to lead in AI infrastructure."

He added that with single-window clearances, 20-year tax exemptions, GST benefits, and incentives extending to 2047, the country is strategically positioned to emerge as a global data centre and AI hub.

The country's data centre market is supported by a diverse mix of global operators, domestic providers, hyperscalers, and telecom companies. Also, there is a massive surge in data centres due to AI.

India hosts around 17-18 international subsea cables with landing stations concentrated in Mumbai, Chennai, Kochi, Tuticorin and Thiruvananthapuram. As global data traffic and cloud adoption accelerate, these highly connected coastal hubs are well-positioned to attract sustained capital inflows and anchor the next phase of data centre investment growth in the country.

Commitments from OpenAI, Adani Group, Tata Consultancy Services, STT GDC, Larsen & Toubro, NVIDIA, and Sify Technologies across hyperscale, colocation, AI infrastructure, and integrated digital ecosystems will shape the landscape of the country's data centre market.