CHICAGO, Sept. 23, 2025 /PRNewswire/ -- The India data center market was valued at US$ 8.01 billion in 2024 and is expected to reach US$ 24.78 billion by 2033, growing at a CAGR of 13.37% during the forecast period 2025-2033.
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The India data center growth is experiencing remarkable capacity expansion to meet soaring digital demands. In 2024, the operational data center capacity reached 1,110 MW, projected to surge to approximately 1,600 MW by the end of this year. This growth trajectory in data center investment is set to continue, with estimates indicating expansion to about 2,070 MW by the close of 2025. In the first half of 2024, operational stock reached around 942 MW, underscoring the relentless pace of development. By 2025, the total data center in India in terms of installed IT load capacity is anticipated to hit 3,983.22 MW, showcasing significant advancements in computational power.
New supply is consistently added across key urban clusters, reinforcing the foundation of the India data center market. In 2024, around 191 MW of new IT capacity was introduced nationwide, with approximately 71 MW becoming operational in the first half of the year. The development pipeline remains robust, with projections indicating 791 MW of new capacity to be added by 2026. Additionally, backing from a staggering USD 5 billion investment is essential for accommodating an additional 785 MW of new data center supply. Hyperscale data center players have risen from five in 2019 to 15 in 2024, with approximately 121 existing colocation data centers in India by 2025.
Explosive Demand from AI and Cloud Drives Market Absorption
Demand for digital infrastructure is equally impressive, showcasing an insatiable appetite for data center growth. In a landmark achievement, India recorded a data center absorption rate of 407 MW of IT capacity in 2024. This momentum is set to accelerate, with expectations of an additional 600 MW growth in absorption in 2025. In the first half of 2024, around 200 MW in IT capacity was transacted, while absorption surged to 122 MW in the second half. This leasing activity translates into a significant real estate footprint, with total data center stock projected to reach 31 million square feet by the end of 2025, necessitating an additional 10 million square feet by 2026.
Artificial Intelligence serves as a primary catalyst for the India data center market expansion. Cloud Service Providers have pre-committed an astonishing 800 MW of capacity for future AI workloads, and dedicated demand is expected between 650-800 MW from 2024 to 2026. Hyperscalers anticipate AI-related requirements exceeding 500 MW, with these operators accounting for 22% of the total existing data center stock in 2024. The power required for AI training is immense, with models like GPT-4 consuming around 30 MW over several weeks, intensifying the sector's energy demands.
Substantial Capital Inflows Propel India Data Center MarketInvestment Growth
The potential of this sector attracts significant international and domestic investments. A landmark joint venture was formed in November 2024 between Colt Data Centre Services and RMZ Corp, aiming to invest USD 1.7 billion in India's digital infrastructure, specifically targeting over 250 MW of new data center capacity. top data cetenters in India like Amazon Web Services (AWS) are also committing colossal funds, with a $12.7 billion investment to expand their presence in the country. Domestic players are scaling up, with Sify pledging over $360 million in data center investments. The overall industry anticipates receiving USD 5.7 billion by 2026, while Princeton Digital Group plans to invest around USD 1 billion to expand its Chennai and Mumbai portfolio.
Corporate and government investments provide powerful support, ensuring sustained growth in the India data center market. In January 2025, Reliance Industries announced a partnership with Nvidia for AI infrastructure, bolstered by a USD 1.16 billion investment from the Indian government for AI development. These capital injections not only facilitate construction but also build the foundational pillars for India's technological innovation and economic progress.
Strategic Land Acquisitions Signal Future Growth Trajectories
Land acquisition trends are leading indicators of future developments, with activity focused on major metropolitan hubs. In 2024, approximately 200 acres of land were acquired for data center development across India's urban centers. Geographically, Mumbai is expected to require 4.41 million square feet of real estate space in the next three years, while Chennai requires 2.89 million square feet. Microsoft's purchase of 48 acres in Hyderabad for INR 267 crore in May 2024 exemplifies a commitment to strategic land acquisition.
Other major players are actively securing prime land, shaping the competitive landscape of the India data center market. Notable transactions include Equinix acquiring 1.38 acres in Mumbai valued at Rs. 155 crores and Digital Connexion securing 2.15 acres for a powerful 40 MW data center. Additionally, Google is developing a massive 381,000-square-foot data center in Navi Mumbai, slated for completion in 2025. These land banking activities highlight significant confidence in the market's future and identify the next epicenters of digital growth.
Robust Construction Pipeline Ensures Sustained Supply
The ongoing construction pipeline reveals a promising future supply outlook of the India data center market. By late 2024, 475 MW of data center capacity is actively under construction, with the 2024-2028 development horizon projecting a total capacity of 1.03 GW under construction and an additional 1.29 GW in the planning stages. Specific projects showcasing this momentum include Digital Connexion's flagship 20 MW greenfield data center, MAA10, located in Chennai.
By 2025, India will house approximately 121 operational colocation data centers, with numbers expected to grow. The industry diversifies as hyperscale data center players expand from five in 2019 to 15 in 2024, fostering a competitive and innovative market capable of delivering cutting-edge infrastructure to both global and domestic clients.
Surging Power Requirements and Energy Efficiency
The impressive growth of the data center sector leads to colossal energy demands, making power management essential. Data center electricity demand in India is forecasted to reach 13 TWh in 2024 and projected to quadruple to 57 TWh by 2030. India's anticipated addition of 850 MW of data center capacity between 2024 and 2026 positions it as a regional leader in Asia-Pacific, excluding China.
Efficiently addressing energy needs provides a competitive advantage in the India data center market. Development costs remain relatively low, with construction costs in Mumbai noted at just $6.60 per watt in 2024. The rise of power-hungry AI applications underscores the need for energy-efficient solutions, as a single high-end AI model requires substantial energy. Operators with secure power sources and innovative designs will thrive in this high-stakes environment.
Intense Competition Among Colocation Giants
The colocation market features fierce competition among established global leaders and emerging domestic players in the India data center market. By 2025, STT Global Data Centers India Pvt Ltd leads with a portfolio of 30 data center projects and a total IT load capacity of 400 MW, followed closely by CtrlS Data Centers Ltd with 20 projects and 250 MW. Global leader NTT Communications operates 18 facilities, contributing 268 MW, while Nxtra Data Limited runs 12 data centers exceeding 200 MW capacity.
Emerging players also make their mark. Yotta Data Services operates three large-scale data centers, boasting a total capacity of 434 MW, and DigitalConnexion manages two facilities with a combined capacity of 150 MW. AdaniConnex, a joint venture between Adani Group and EdgeConneX, has six projects with a capacity of 33 MW, while Web Werks India operates six facilities totaling 40 MW. This competitive landscape drives innovation, enhancing service quality and providing clients with a wide range of infrastructure options.
Emerging Markets in Tier-II and Tier-III Cities
While major cities like Mumbai, Chennai, and Hyderabad remain central to data center operations, a clear trend of expansion into Tier-II and Tier-III cities is emerging. Increased demand for Edge Data Centres arises in these regions, driven by the need for lower latency in applications like streaming, gaming, and IoT, as well as localized data processing. Yotta Data Services has announced plans for five new projects, including one in GIFT City, Gujarat, indicating a strategic move beyond traditional markets.
This geographical diversification receives support from government initiatives and hyperscale providers' strategies, broadening the India data center market's footprint. The government's approval of a $1.24 billion investment in AI infrastructure will catalyze digital growth beyond primary urban centers. Google's investment in a 1 GW hyperscale campus in Visakhapatnam solidifies its commitment to expanding digital infrastructure nationwide.
Supportive Government Policies Foster Investment Climate
The rapid growth of the data center sector is bolstered by supportive government policies and a flourishing economic environment. The Indian government committed INR 10,300 crore to operationalize the IndiaAI Mission, aiming to enhance the nation's computational infrastructure, fueling data center demand and development. Such proactive, policy-driven support creates a favorable investment climate, de-risking commitments and encouraging long-term investments from global and domestic players.
The India data center market is poised for unprecedented growth. The convergence of massive private investments, strategic government support, and escalating demands from digitalization and AI positions the industry to play a pivotal role in establishing India as a leading digital economy for decades. Stakeholders can anticipate immense opportunities in a market set for transformative growth.
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Top Players in India Data Center Market
- Tata Communications Ltd
- STT GDC INDIA Pvt Ltd
- CtrlS Datacenters Ltd
- Sify Technologies
- Netmagic Solutions Pvt Ltd
- Web Werks India Pvt Ltd
- ESDS Software Solutions Ltd
- NxtGen Datacenter and Cloud Technologies Pvt Ltd
- GPX India Pvt Ltd
- Yotta Data Services Pvt. Ltd
Market Segmentation Overview:
By Hardware
- Servers
- Blade servers
- Rack servers
- Tower servers
- Micro servers
- Storage Systems
- Storage Area Network (SAN)
- Network-Attached Storage (NAS)
- Direct-Attached Storage (DAS)
- Cloud storage
- Power and Cooling Systems
- Power Supply
- Uninterruptible Power Supply (UPS) systems
- Generators
- Power distribution units (PDUs)
- Cooling Solutions
- Air conditioning units
- Liquid Cooling Systems
- Advanced Cooling Technologies
- Racks and Enclosures
- Open frame racks
- Enclosed Racks
- Customized Enclosures
By End Users
- IT and Telecom
- Banking, Financial Services, and Insurance (BFSI)
- Healthcare
- Government
- Manufacturing
- Others
By Region
- North India
- South India
- West India
- East India
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Japan Data Center Market: By Component (Hardware (Servers (Blade servers, Rack servers, Tower servers, Micro servers), Storage Systems (Storage Area Network (SAN), Network-Attached Storage (NAS), Direct-Attached Storage (DAS), Cloud storage), Power and Cooling Systems (Power Supply (Uninterruptible Power Supply (UPS) systems, Generators, Power distribution units (PDUs)), Cooling Solutions (Air conditioning units, Liquid Cooling Systems, Advanced Cooling Technologies), Racks and Enclosures (Open frame racks, Enclosed Racks, Customized Enclosures), Software (Data Centre Management Software, Virtualization Software, Security Software), Services (Professional & Managed and Training & Support)); Data Center Type (Colocation, Hyperscale, Edge, Cloud- Based, Enterprise, Managed); Tier Standard (Tier 1, Tier 2, Tier 3, Tier 4); Enterprise Size (Small and Medium-Sized Enterprises (SMEs) and Large Enterprises); Industry (Banking, Financial Services, and Insurance (BFSI), IT and Telecom, Government and Defense, Healthcare, Energy, Manufacturing, Retail, Media and Entertainment, Others (education, transportation, etc.))-Market Size, Industry Dynamics, Opportunity Analysis and Forecast for 2024-2035
Global Data Center Market: By Component (Solution and Services); Type (Co-location, Hyperscale, Edge, and Other); Enterprise Size (Small and Medium-Sized Enterprises (SMEs), Large Enterprises); Industry (Banking, Financial Services & Insurance (BFSI), Information and Communication Technology, Government Agencies, Energy & Utilities, Healthcare, and Other); Region-Market Size, Industry Dynamics, Opportunity Analysis and Forecast for 2025-2033
Global Hyperscale Data Center Market: By Infrastructure (IT Infrastructure, Electrical Infrastructure, Mechanical Infrastructure, General Construction), By Cooling System (Crac & Crah Units, Chiller Units, Cooling Towers & Dry Coolers, Economizers & Evaporative Coolers, and Others), By Cooling Technique (Air based cooling and Liquid Based Cooling) By General Construction ( Building Development, Installation & Commissioning Services, Building Design, Physical Security, and DCIM), and Region-forecast and Analysis for 2024-2032
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