India’s Data Centre Boom Set to Surge to $22 Billion by 2030

India’s data centre industry is on a strong growth trajectory and is expected to more than double in size, reaching $22 billion by 2030 from approximately $10 billion in 2025, according to a report by Vestian. This rapid expansion is being powered by increasing adoption of cloud computing, rising artificial intelligence (AI) workloads, and a sharp surge in digital consumption across the country.

The sector has already witnessed significant investment activity in recent years. Between 2020 and 2024, India’s data centre market attracted investments worth $13–15 billion, with foreign institutional investors contributing nearly 80 per cent of the total inflows. Looking ahead, the momentum shows no signs of slowing down, as announced investments ranging between $60–70 billion over the next five years reflect sustained confidence from hyperscale operators and joint venture platforms.

On a global scale, the data centre industry is undergoing rapid expansion. Installed capacity worldwide is currently estimated at 40–50 gigawatts (GW) and is expected to surpass 100 GW by the end of the decade. Within this evolving landscape, India is increasingly being seen as a key strategic hub in the Asia-Pacific region, backed by strong policy support, growing hyperscaler presence, and a rapidly expanding digital economy.

At present, India’s operational data centre capacity stands at around 1.4–1.6 GW spread across 164 facilities. Additionally, more than 700 megawatts (MW) are under construction, while another 1–1.2 GW is in the planning phase. The report indicates that installed capacity could rise to 1.7–2 GW by the end of 2026 and further scale up to 4–5 GW by 2030, reflecting continued infrastructure development.

The demand for data centres is being driven by multiple factors, including a growing base of internet users, increased enterprise reliance on cloud platforms, and the rapid expansion of AI and high-performance computing workloads. The growth of digital payments, OTT platforms, and the rollout of 5G services has further accelerated data consumption. Currently, average monthly wireless data usage has crossed 25 GB per user, underscoring the need for robust and scalable data infrastructure.

“India's data centre sector is rapidly transforming on the back of strong policy support and rising digital demand,” said Shrinivas Rao, chief executive officer (CEO) at Vestian. He added that incentives such as single-window clearances, long-term tax exemptions, and goods and services tax (GST) benefits position India as an emerging global hub for data centres and AI infrastructure over the coming decades.

India also enjoys a cost advantage compared to other Asia-Pacific markets. Construction costs are estimated at $6–7 million per MW, which is significantly lower than in mature markets like Singapore and Japan. This cost efficiency is encouraging large-scale investments and capacity additions.

Among cities, Mumbai continues to dominate, accounting for nearly 49 per cent of total operational capacity. It is followed by Chennai at 18 per cent and the National Capital Region at 11 per cent. Emerging hubs such as Pune, Bengaluru, and Hyderabad are also gaining traction due to their strong IT ecosystems and competitive business environments.

Meanwhile, Tier-II cities including Ahmedabad, Kochi, Jaipur, and Visakhapatnam are beginning to play a larger role in the sector’s expansion. These markets currently have a combined capacity of 60–80 MW, which is expected to exceed 100 MW by 2026, supported by improved infrastructure, favourable policies, and lower land costs.