Powering India's cloud with sustainable data hubs

India's data centre boom is reshaping digital infrastructure, demanding clean energy, local innovation, and policy alignment to sustain its growth.

- DAVID SEHYEON BAEK

India's digital economy is scaling at an unprecedented pace.

From UPI transactions and OTT streaming to 5G-enabled factories and AI-driven platforms, the sheer volume of data generated in the country is exploding. By 2030, India’s data traffic will be many times greater than today, driven by half a billion new internet users, the expansion of connected devices, and the rapid rise of AI applications. At the centre of this surge lies one critical infrastructure: data centres.

These facilities—warehouses of servers that process, store, and distribute information—are the beating heart of the digital economy. Yet they are also energy-hungry behemoths, consuming electricity at levels comparable to small cities. For India, building a sustainable data centre strategy is not just about server racks and fibre-optic cables. It is about securing the energy that powers them, while balancing economic growth, climate commitments, and global competition with giants like China and the United States.

MARKET GROWTH AND INVESTMENT MOMENTUM

India’s data centre sector is already booming. Industry estimates show that the country’s capacity stood at about 1,263 megawatts (MW) in April 2025 and is projected to exceed 4,500 MW by 2030—a more than threefold rise at a CAGR of 35-40%. The real estate footprint is expected to reach nearly 55 million square feet by the end of the decade.

This expansion is being matched by capital. According to IBEF, the sector has attracted USD 14.7 billion in investment since 2020, with another USD 20-25 billion expected by 2030, much of it from foreign institutional investors. Mumbai (41%), Chennai (23%), and Delhi NCR (14%) continue to dominate India’s data centre landscape, while Tier 2 and Tier 3 cities such as Lucknow and Patna are now emerging as new destinations for edge facilities.