Data centres boost India’s trillion-dollar digital economy growth

Data centres boost India’s trillion-dollar digital economy growth

Fuelled by the rapid adoption of digital infrastructure amid the pandemic, rising digital usage, cloud consumption, and ensuing 5G rollout, India's data centre industry is poised for a boom.

According to a joint study by Nxtra and JLL, much of industry growth will happen around Mumbai and Chennai due to their business and infrastructure advantages, strategic location, and cable landing stations.

Indian data centre industry stood at 499 MW IT load as of H1 2021 and is likely to record another strong year of demand growth with commensurate supply. Its capacity is expected to double to 1008 MW IT load by 2023, the study revealed.

Further, the study also shows that the convergence of data protection, strong demand from cloud players, migration from captive to cloud, industry-friendly regulations, government’s digital initiatives, and investments will spearhead the ongoing growth of the data centre industry in India.

“India’s digital transformation is expected to create an economic value of US$1 trillion by 2025. Apart from existing sectors, new areas like agriculture, healthcare, logistics, jobs and skills market, e-governance and other areas, coupled with advanced technologies, will lead to significant growth of data storage and computing,” said Rachit Mohan, Head, Data Centre Advisory, India, JLL.

He said that the Indian data centre industry will act as the backbone, enabling India to emerge as a global hub. Owing to their locations and infrastructure, Mumbai and Chennai are expected to be the largest beneficiaries of potential growth in India’s data centre market.

The report highlights that while India’s data centre future will largely depend on coastal cities with ready access to cable landing stations, landlocked cities like Delhi NCR, Hyderabad, Bangalore, Kolkata, and Pune will also be beneficiaries of a growing data centre industry.

According to the joint research, India’s digital journey is accelerating rapidly, and cloud, data centre, and telecom players are adopting various strategies to capture a share of this growing market.

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