India’s data centre sector is on a remarkable growth trajectory, with demand poised to exceed 3,400 megawatts (MW) of IT capacity by 2030. The rise in adoption of cloud computing, big data, Internet of Things (IoT), and artificial intelligence (AI) is fueling this expansion, making the country a major hub for digital infrastructure.
Rapid Growth Driven by Tech and Business Needs
India’s appetite for data centre capacity is expanding exponentially. According to Savills India, a leading real estate advisory firm, the market is forecasted to grow at a compound annual growth rate (CAGR) of 21% from 2024 to 2030. The surge comes as businesses across sectors embrace digital transformation.
In 2024 alone, India saw the absorption of 407 MW of IT capacity while adding 191 MW across major cities. Hyperscalers, banking, financial services, insurance (BFSI), and IT service sectors are among the primary drivers of this growth. Companies in these sectors increasingly depend on data centre operators for colocation services, which are critical to their operations.
City-Level Breakdown of Data Centre Expansion
Mumbai remains the epicenter of India’s data centre boom, accounting for 53% of total absorption in 2024. Other cities like Hyderabad (14%), Chennai (10%), and Pune (10%) are also contributing significantly to the expansion.
One notable trend is the acquisition of over 200 acres of land by data centre operators in 2024 across Mumbai, Hyderabad, Pune, Chennai, and Bengaluru. These acquisitions highlight a growing emphasis on scaling infrastructure to meet demand.
However, Tier-II and Tier-III cities like Bhubaneswar, Patna, and Lucknow are emerging as new hotspots for edge data centres. Factors such as the rollout of 5G and increased mobile application usage are driving this trend.
Key Trends and Insights
Here are some critical developments shaping India’s data centre market:
- Demand Surge: Over 450 MW of IT capacity is expected to be in demand across major cities in 2025.
- Supply Increase: Supply additions are projected to reach 600 MW IT capacity in the same year.
- Sector Influence: E-commerce, BFSI, and hyperscalers remain major contributors to market growth.
- Land Acquisitions: The focus on long-term scalability is evident, with significant investments in land across strategic locations.
The Rise of Edge Data Centres
As mobile application usage and 5G technology proliferate, there is a growing need for edge data centres to provide localized, low-latency services. Cities such as Coimbatore, Madurai, Vizag, and Raipur are seeing increasing demand for these facilities, reflecting a shift in focus beyond traditional metro hubs.
Table: Key Metrics of India’s Data Centre Market (2024-2030)
| Metric | 2024 | 2030 (Projected) |
|---|---|---|
| IT Capacity Demand (MW) | 407 | 3,400 |
| CAGR (%) | – | 21% |
| Major City Contributions | Mumbai: 53% | Expanding to Tier-II/Tier-III cities |
| Land Acquisitions (acres) | 200+ | Increasing |
The rapid development of data centres across both metro and non-metro areas underscores India’s growing importance in the global digital landscape.
Future Prospects for the Market
The Indian government’s push towards digitization, combined with the private sector’s investments, is expected to sustain the momentum in the data centre market. Tier-II and Tier-III cities, in particular, could become pivotal in expanding the reach of digital services nationwide.
India’s journey towards becoming a global data centre powerhouse is just beginning, with exciting developments ahead in technology and infrastructure.
