What is the current state of the data center market in your region?
Propelled by businesses’ realigned approach to IT infrastructure and widespread migration to colocation data centers, data center investments in India have skyrocketed, and colocation data centers are an integral part of both enterprise digital transformation and India’s ambitious digitization drive, the Digital India mission.
The influx of global hyperscalers and the government’s push to boost the industry have also contributed to this growth. Since 2017, India’s total data center capacity has more than doubled, establishing it among the top five in APAC. As India inches closer to a one trillion USD digital economy, this capacity is expected to grow to 1,700MW by 2025.
What are the key drivers and goals of the data center business in your region?
Key drivers include supporting digital transformation, meeting the growing demand for data storage / processing, and complying with data localization requirements. As IT leaders shift towards innovation with evolving use cases of AI, ML, Big Data, and IoT, they shed on-premise IT infrastructure, which leads to huge demand for data center infrastructure. Government initiatives, like Digital India and the Smart Cities mission, and growing last-mile Internet connectivity require data centers for storage, cloud computing, and service delivery. Other incentives involve favorable data center policies, ease of doing business, availability of skilled talent pool, robust connectivity, and cost advantage.
What benefits do the local area recognize from the industry?
Beyond serving as the backbone for India’s digital endeavors, data center growth means significant employment opportunities. Data centers also stimulate regional economy through investments they attract, direct spending by operators, and the ripple effect from related industries. As data centers require robust and reliable Internet connectivity, they also boost infrastructure and connectivity around them, which fosters innovation, e-commerce, and digital service growth.
What are the biggest advantages for your location as a data center cluster?
With its vast coastline, India has robust subsea cable infrastructure that’s well-connected to Asia and Europe. Favorable government / state policies and tremendous cost advantages in land acquisition and construction make it easier to set up data centers. Infrastructure power and skilled talent are key for any data center, and India has no dearth of either—and a focus on renewable energy sources.
Who are the biggest champions for data centers in the region?
Domestic and global investments lead the way in this two-year, 10 billion USD opportunity growth plan. Yotta alone plans to add 1,300MW by expanding our network of hyperscale data center parks. We’re also investing in edge data centers across Tier II and Tier III markets to provide last-mile connectivity and infrastructure.
What challenges have you identified, and what is being done to overcome those challenges?
While our industry has grown exponentially, existing capacity is outpaced by demand. To serve forecasted demand in the next 5–7 years, India will need to build 7–10 times more capacity. This challenge, however, equals opportunities. For example, Yotta will invest 60,000+ INR crores to build a network of hyperconnected hyperscale data center parks and edge data centers. Another challenge is the lack of homegrown hyperscale cloud infrastructure, so Yotta plans to leverage indigenous capabilities to build our own global cloud platform.
How do you see data centers contributing to the digital transformation in the years to come?
While the first phase of digital transformation focused on the groundwork, now businesses will increase innovation efforts. New technologies present endless possibilities, but enterprises who identify the right use cases will gain a competitive advantage. The role of data centers is no longer just storage—now they also enable computing, connectivity, and transformation.
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