India's digital revolution is driving a five-fold increase in data centre capacity expansion, with an expected addition of 464 MW of new colocation data centre capacity annually until 2028. The demand for data centres is transforming India's digital infrastructure, with growth seen across the country, not just in urban areas. The rise in the adoption of internet services, smartphones, social media, and OTT channels is fueling the demand for data centres.
The Indian government's active promotion of digitalisation is expected to sustain the demand for data centres in the long term, presenting both opportunities and challenges for India's digital transformation story.
India is on the brink of a digital revolution, with a steep rise in data usage and digital adoption driving this transformation. A report by Cushman and Wakefield predicts a five-fold increase in data centre capacity expansion in the coming years. This surge is not just about consumption; it's also about creation and storage. India is expected to add 464 MW of new colocation data centre capacity each year until 2028, a formidable number that surpasses the capacity addition in 2022, which stood at 126 MW.
The demand for data centres is high, transforming India's digital infrastructure. Both colocation data centres and cloud firm-owned data centres are being built at growing speeds over the last few years. While adding an average of 464 MW of Colo capacity each year until 2028 may seem like good delivery speed, India shall keep building more to capitalise on its digital transformation story.
The country's digital growth is not just confined to urban areas. India's colocation data centre capacity stood at 977 MW across the top seven cities in the second half of 2023. About 258 MW of Colo capacity came in 2023 alone. This indicates that the growth is pan-India, with a focus on areas that support robust infrastructure and have a concentration of tech and business activities.
The digital revolution in India is not just about infrastructure. It's also about usage. The country is experiencing an exponential rise in the adoption of internet services, smartphones, social media, and OTT channels. This digital adoption is driving the demand for data centres. Over the next five years, India is likely to see the fastest growth in penetration of smartphones, internet, OTT subscriptions, and social media usage. This growth is expected to further fuel the demand for data centres.
The digital revolution in India is reminiscent of the dot-com boom in the United States in the late 1990s and early 2000s. However, the digital revolution in India appears to be more sustainable. The growth in demand for data centres is driven by a genuine increase in digital adoption, rather than speculative investment. Moreover, the Indian government is actively promoting digitalisation, which is likely to sustain the demand for data centres in the long term.
The digital revolution in India is driving a significant increase in the demand for data centres. This demand is expected to result in a five-fold increase in data centre capacity expansion in the coming years. The growth is driven by a steep rise in data usage and digital adoption, with India likely to see the fastest growth in penetration of smartphones, internet, OTT subscriptions, and social media usage over the next five years. This digital revolution presents both opportunities and challenges for India, as it seeks to capitalise on its digital transformation story while ensuring that the benefits of digitalisation are equitably distributed.
