India set to add about 250 megawatt data centre capacity 2023: Savills

The Indian data centre market is experiencing robust growth, led by the growing rate of digitalisation backed by a strong government policy impetus under the Digital India initiative.

Considering the rapid rise in internet usage and the advent of 5G, the Internet of Things and Artificial Intelligence, India’s data centre market is poised for rapid expansion, said property consulting firm Savills India on Thursday.

A data centre is typically a large group of networked servers used by organizations for the remote storage or distribution of large amounts of data.

“Given the country’s rich network connectivity, cost advantage, stable government, availability of skilled labour and low climate risk, India is well-positioned to serve as a regional data centre hub in Asia,” said Niraj Karale, Director and Head, of Data Centre Services of Savills India.

Savills expects the Indian market to surpass one-gigawatt capacity in 2023. Around 250 megawatts of additional data centre capacity is expected to come online, taking the total co-location capacity in India to 1.15 gigawatts.

In 2022, India, the consulting firm said, saw an increase in data centre colocation capacity of more than 150 megawatts, with a large share of it in Mumbai and Chennai.

“Data suggests that two million sq. ft. will be added towards data centre growth. Many states such as Karnataka, Tamil Nadu, Uttar Pradesh, Odisha, Telangana and West Bengal have announced data centre policies in the last two years to facilitate investments, realising the growth potential,” Savills said in a statement on Thursday.

Environmental, social and governance (ESG) measures are in general at the top agenda of data centre operators with new projects delivered with improved specifications and high-quality environmental, health, and safety (EHS) standards.

“Going forward the data centre industry’s focus will shift towards being as close as possible to the customer base, including those in Tier-2 cities like Jaipur, Lucknow, Kochi, Coimbatore etc. This trend will drive demand for real estate in Tier-2 as well as Tier-3 cities in some regions,” Karale added.