According to ICRA, India is experiencing a data center (DC) revolution, with an additional 5,000 MW of capacity expected to be installed over the next six years at a cost of Rs 1.50 lakh crore.
With numerous Indian and foreign corporations intending to develop them, data localisation and data explosion are paving the way for a DC revolution in India.
According to ICRA, captive consumers like Amazon and Microsoft as well as Indian corporates like the Hiranandani Group, the Adani Group—which is in a joint venture with EdgeConnex—the Reliance Group, as well as foreign investors Blackstone, CapitaLand, and Princeton Digital Group have all started investing heavily in Indian DCs. Existing competitors like NTT, CtrlS, Nxtra, and STT India are also enhancing their capabilities alongside them.
“Increase in internet and mobile penetration have become the key triggers of India’s digital explosion, along with the government’s push for e-governance/digital India, the adoption of new technologies (cloud computing, IoT, 5G, etc.), growth in social media, games, e-commerce and OTT platforms etc. This, along with favorable regulatory policies, such as the draught Digital Data Protection Bill 2022, giving infrastructure status to data centers, and special incentives from the federal and state governments, such as land at subsidized costs, power subsidies, stamp duty exemptions, discounts on the use of renewable energy, procurement of IT components made locally, are expected to increase DC investments in the nation “Vice President and Co-Group Head for Corporate Ratings, Anupama Reddy, said.
She claims that some of the crucial criteria a DC operator would look for in a location are landing stations, fiber connectivity, uninterruptible power supply, proximity to the tenant’s headquarters, and a high score on disaster proofing.
The two cities having the most landing stations are Mumbai and Chennai, with Mumbai being the favored location for a DC operator.
“In 2017 and 2018, the flood completely damaged the reputation of Chennai. Other important growing areas include Hyderabad and Pune, where some large hyper scalers are constructing enormous DCs closer to their operational bases in India “Added Reddy.
In August 2022, the government announced that it was withdrawing the draught Personal Data Protection Bill and replacing it with the Digital Personal Data Protection Bill 2022.
“Compared to the previous Bill, which included a legal obligation to store personal data locally, the new draft has toughened penalties for violations and simplified cross-border data flow. It is yet unclear how the new Bill will affect India’s need for data centers “Reddy stated.
