Gen AI, data centres march into 2025

Stakeholders are gearing up for a boom amid expectations of easing inflation concerns in West, and government's boost to domestic R&D expenditure

- Shouvik Das

India's technology sector is likely to see generative artificial intelligence (generative AI) and related data applications define client orders, financial growth and technical innovation in 2025. In turn, this is expected to generate a spurt in demand for data centres and their services.

Industry stakeholders ranging from the US's Big Tech firms, as well as data centre and software services companies, are gearing up for a boom in demand amid expectations of easing inflation concerns in the West, and the Indian government's boost to domestic research and development (R&D) expenditure in the coming year.

On 12 December, Mint reported that the Centre was evaluating plans to roll out $3 billion in incentives to boost R&D in India. The country, already a hub for fresh technical talent, is now looking to invest in innovation to climb up the value ladder—as opposed to being a usage economy so far.

At the core of this push is the establishment of generative artificial intelligence as a key differentiator in the near term, and its impact on data centres.

On 28 September, Mint reported that the Adani group is likely to pump in $4 billion to establish a net data centre capacity of 1.5GW (gigawatt) within the next two years, a plan that originally had a timeline of five years. This boost is driven by the influx of AI in enterprises, and the anticipated data boom that is expected to come with it.

Ashish Arora, chief executive of Bharti Enterprises' subsidiary Nxtra, also added that the company is investing $600 million to double its net data centre capacity to 400MW (megawatt) by 2026, a chunk of which will be expanded in 2025 itself.