Cyber risks lurking beneath India’s data centre ops build out

India is racing to become a global hub for artificial intelligence (AI) and cloud computing, offering tax breaks to attract billions in foreign investment. But cybersecurity experts warn the country is building this critical infrastructure faster than it can defend it, creating what they call “high-value honeypots” for state-backed hackers.

The government recently announced a 20-year tax exemption for large cloud providers setting up data centres in India, which was later extended to domestic players as well. The data centre market has already attracted over $61 billion in investment by 2025, and the new tax breaks are expected to pull in another $200 billion. Capacity is projected to grow 48% by 2029, according to Gartner.