India's data centre capacity set to surge 77 pc to reach 1.8 GW by 2027

This remarkable expansion comes on the heels of the industry surpassing the 1 GW milestone in 2024, demonstrating a robust 24 per cent CAGR since 2019.

Driven by cloud service providers' demand and the burgeoning AI sector, this growth positions India as a rising powerhouse in the global digital infrastructure landscape, according to the report by JLL.

Mumbai has emerged as the undisputed leader in India's data centre market, commanding 52 per cent of the country's total capacity. This dominance highlights Mumbai's critical role in India's digital infrastructure and its position as the nation's data hub.

Chennai follows at a distant second, hosting 21 per cent of India's data centre capacity. Interestingly, established tech hubs like Bengaluru, often called India's Silicon Valley, and Hyderabad each account for 7 per cent of the country's data centre capacity.

"The India AI mission will foster AI adoption across sectors, contributing to the $1 trillion digital economy goal. India is expected to add a new data centre new supply of 785MW (IT load) with $5 billion in investments for the digital and real estate infrastructure," said Rachit Mohan, APAC Lead (Data Centre Colocation Leasing) and Lead (Data Centre Transactions and Leasing), India, JLL.

"The future demand growth is expected to be impacted by headwinds of US diffusion policy which restrict transfer of advanced technology," Mohan added.

BFSI (banking, financial services, and insurance) and technology sectors follow closely, contributing 18 per cent and 12 per cent, respectively, of the total occupancy.

The Indian data centre industry experienced remarkable growth in H2 2024 (July-December). Supply increased by 51 per cent year-on-year, reaching 114MW.

"The Indian data centre industry is poised for unprecedented growth, driven by technological advancements and supportive government policies," said Samantak Das, Chief Economist and Head of Research & REIS, India, JLL.

The Digital Personal Data Protection Act and its accompanying rules are set to transform the data protection landscape, impacting colocation data centre operators.