India’s data centre industry is set for unprecedented growth, with installed capacity expected to nearly triple to 3 gigawatts (GW) by 2030, up from 1.1 GW in 2024, according to a new report by Avendus Capital titled A Multi-Year Growth Proxy on India’s Data Explosion and Localisation Wave.
The report highlights that annual investments in the sector, currently ranging between ₹8,582 crore and ₹12,870 crore (US$ 1-1.5 billion), are projected to double over the next few years as the country witnesses surging demand for digital infrastructure.
The expansion is fueled by increasing data consumption, the rapid adoption of artificial intelligence (AI) and cloud services, as well as regulatory requirements for data localisation. By 2033, India’s data centre demand is forecast to reach 6 GW, while supply is projected to lag at 4.5 GW, resulting in a potential 1.5 GW capacity gap.
To address this growing need, core markets such as Mumbai, Delhi-NCR, and Chennai are expected to see the rise of hyperscale-ready data centres, while Tier II and Tier III cities are set to develop edge-ready facilities to support low-latency applications.
Government incentives, including subsidised land banks, electricity duty waivers, and favourable policies, are catalysing the pace of capacity addition. Established players like ST Telemedia Global Data Centres (STT GDC) and Sify Technologies continue to dominate the market, but new entrants are aggressively stepping in to capture the rising enterprise demand.
One of the notable investments comes from Delhi-NCR-based Anant Raj Ltd, which has announced a capital expenditure of ₹18,000 crore (US$ 2.1 billion) to expand its capacity from 28 megawatts (MW) in FY26 to 307 MW by FY32.
“With pre-zoned sites, policy support, and robust power access, we are well-positioned to serve both public and private sector clients,” said Mr. Amit Sarin, Managing Director, Anant Raj Ltd.
With the combined momentum of AI-driven workloads, 5G expansion, and data localisation policies, India is fast emerging as a global data hub. The expected shortfall in supply by 2033 presents both a challenge and a significant opportunity for industry players and investors to bridge the gap with large-scale, sustainable infrastructure solutions.
