- The Indian data centre industry’s capacity is expected to grow to 1,078 MW by 2025.
- During July-December 2020, India is expected to see another 57 MW new supply.
Bengaluru: India could attract investments worth $4.9 billion into adding new capacity to its data centres as it has been recognised as an indispensable part of the growing digital economy.
The impact of data protection laws, increased shift from captive to colocation data centre and implementation of new technologies like 5G, edge computing and the internet of things (IoT) will drive the next phase of demand for data centres.
The data centre capacity of India, which has the world’s second-largest data subscriber population, is expected to grow to 1,078 MW by 2025 from 375 MW in the first half of this year, registering an annual growth rate of 21 per cent, according to a recent report by consultancy firm JLL.
A total of 9.3 million square feet of real estate will be added to the existing capacity with Mumbai leading the numbers followed by Chennai and Hyderabad.
Chennai is expected to emerge as the second fastest growing destination due to its advantages of submarine cable landing stations and lower development cost.
Investments worth more than $1 billion was committed during the first half of 2020. Yotta Infrastructure, owned by Hiranandani group, will invest ₹4,000 crore while HDCI Data Centre Holdings will invest ₹2,800 crore, and Singapore-based ST Tele Media, ₹1,500 crore in accordance to the MoUs signed with the Tamil Nadu government recently.
During the 2020-25 period, Mumbai is expected to see the highest capacity addition as it continues to be the preferred choice for large cloud players because of its infrastructure advantage.
Mumbai with 34MW will account for 60 per cent share of total supply in H2 2020, followed by Pune (23 per cent) and Chennai (14 per cent)
During July-December 2020, India is expected to see another 57 MW new supply.
The last five years has witnessed increased investments across the globe.
While 2019 witnessed deals worth $15 billion being closed, the benchmark was crossed in the first four months of 2020. As per JLL data, a total of 388 transactions at an aggregated value of $90 billion was closed during 2015-2020.
The Covid-19 pandemic reinforced the dependence of several industries on digital infrastructure and significantly increased cloud adoption. Businesses and industries continued to remain operational thanks to India’s 375 Megawatt (MW) data centre capacity.
“Higher commitments from hyperscalers and lower availability of large data centre spaces expected to drive expansions by existing and new data centre operators during 2023 and 2024,” the report noted, adding that the expansion plans of 2024 and 2025 are contingent upon the full impact of 5G roll-out, data localisation and growth in IoT devices.