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Table of Content
India’s data centre landscape is witnessing unprecedented growth, with total India data centre capacity surpassing 1.5 gigawatts (GW) for the first time. According to a CBRE report, Mumbai dominates the market, accounting for 53% of operational capacity due to its strategic proximity to global internet exchange points and undersea cable landing stations.
This milestone underscores the rapid pace of digitalisation, growing adoption of artificial intelligence (AI), and proactive government policies driving the expansion of India’s digital infrastructure.
City-Wise Distribution of India’s Data Centre Capacity
Mumbai’s 53% share in total India data centre capacity highlights the city’s status as the country’s digital hub. Following Mumbai, Chennai accounts for 20%, Delhi-NCR 10%, and Bengaluru 7%, collectively making up nearly 90% of India’s total capacity.
Mumbai’s dominance is primarily attributed to its robust connectivity infrastructure, concentration of internet exchange points, and its historical role as a key commercial centre. Meanwhile, cities like Chennai and Bengaluru benefit from technology clusters and proximity to corporate offices, while Delhi-NCR leverages government institutions and business headquarters. The concentration of data centres in these cities reflects strategic choices aimed at minimising latency and optimising operational efficiency.
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Recent Capacity Additions and Growth Trends
The first nine months of 2025 alone saw India adding approximately 260 MW of new data centre capacity. This reflects a sustained year-on-year growth trend, with total India data centre capacity rising from 575 MW in 2021 to 1,529 MW by September 2025.
Annual supply additions have accelerated substantially, from 54 MW in 2021 to 262 MW in the first nine months of 2025. The growth trajectory is driven by the surge in cloud services, AI applications, and increasing enterprise digitalisation. Companies are seeking secure, scalable, and efficient infrastructure to manage data-intensive workloads, further pushing the demand for high-quality data centre facilities.
Investment Landscape and Policy Support
India’s data centre sector has attracted significant investment commitments, reaching $94 billion, with $30 billion pledged in just the first nine months of 2025. Telangana, Maharashtra, and Tamil Nadu have emerged as top destinations for new investments, reflecting regional policy support and favourable business conditions.
Government initiatives, including data localisation norms and sector-specific incentives, have positioned India as a preferred destination for both domestic and international investors. CBRE highlights India’s cost competitiveness in construction and electricity compared to markets such as Singapore, China, and Japan, making the country an attractive hub for high-capacity, energy-efficient facilities.
Role of AI and Digital Transformation
Artificial intelligence is emerging as a major catalyst for the expansion of India data centre capacity. Generative AI, in particular, is driving demand for high-performance computing and storage infrastructure.
According to CBRE, AI adoption is also reshaping operations in global capability centres, enabling automation, talent optimisation, and cost efficiency. India hosts approximately 16% of the global AI workforce, with over 600,000 professionals, a number expected to double by 2027. This talent pool further strengthens India’s position as a competitive destination for next-generation data infrastructure.
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Sector-Wise Demand Drivers
Demand for data centre space in India is being led by technology firms, BFSI (banking, financial services, and insurance), e-commerce, and cloud service providers. Rising digital consumption, remote work trends, and AI deployment are increasing the need for secure, scalable, and geographically distributed facilities.
Tier-2 cities are also gaining attention as developers seek to expand regional data centre footprints. These facilities enable enterprises to manage growing data volumes efficiently while reducing latency and meeting regulatory requirements for localisation.
Future Outlook
CBRE projects that India data centre capacity could exceed 4,500 MW by 2030, representing a $25 billion investment opportunity. Continued digitalisation, cloud adoption, and AI integration are expected to drive strong demand across sectors.
India’s competitive advantages cost-effective operations, robust infrastructure, supportive policies, and a growing AI-skilled workforce position it to emerge as one of the largest data centre markets globally. Developers are increasingly exploring opportunities beyond metropolitan hubs, aiming to establish regional data centres to meet future demand.
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Ans 1. As of Q3 2025, India’s total data centre capacity has surpassed 1.5 gigawatts (GW), reflecting rapid digital infrastructure growth driven by cloud adoption, AI expansion, and government policy support.
Ans 2. Mumbai leads with 53% of India’s total data centre capacity, owing to its proximity to global internet exchange points, undersea cable landing stations, and robust connectivity infrastructure.
Ans 3. After Mumbai (53%), Chennai holds 20%, Delhi-NCR 10%, and Bengaluru 7%, together accounting for nearly 90% of India’s operational capacity.
Ans 4. Key growth drivers include AI adoption, digital transformation, cloud computing demand, and data localisation policies that encourage investment in domestic infrastructure.
Ans 5. In the first nine months of 2025 alone, India added around 260 MW of new capacity, maintaining a strong upward growth trajectory.
Ans 6. Telangana, Maharashtra, and Tamil Nadu have emerged as leading investment destinations due to favourable policies, infrastructure support, and power availability.
Ans 7. Artificial intelligence, especially Generative AI, is driving demand for high-performance computing and storage infrastructure, significantly boosting data centre requirements.
Ans 8. India hosts about 16% of the global AI workforce, with over 600,000 professionals, a figure expected to double by 2027, supporting both domestic and international AI-driven operations.
Ans 9. The technology, BFSI, e-commerce, and cloud service sectors are the main contributors to rising data centre demand, driven by increasing digital consumption and enterprise data needs.
Ans 10. According to CBRE, India’s data centre capacity could exceed 4,500 MW by 2030, representing a $25 billion investment opportunity supported by digitalisation, AI integration, and policy incentives.