India’s DC capacity to Cross 4,500 MW by 2030 With $20-25 bn Investment

Bengaluru, May 28, 2025: India’s data centre (DC) market has entered a transformative phase and has scaled up significantly in recent years. DC capacity has grown over four times in the last six to seven years and stands at 1,263 MW as of April.

This growth is driven by the surge in demand for digital and cloud services, increasing adoption of artificial intelligence (AI) and Internet of Things (IoT) and higher Internet penetration, supported by favourable government policies.

At the city level, Mumbai continued to account for a majority of the DC capacity with a 41 per cent share, followed by Chennai and Delhi-NCR at 23 per cent and 14 per cent, respectively.

This rapid expansion in capacity has resulted in a three-time increase in real estate footprint over the last six to seven years across the top seven DC markets of the country, taking it to 16 mn sq ft (MSF) as of April.

According to the recent Colliers’ report, ‘The digital backbone: Data centre growth prospects in India’, DC capacity across the top seven cities is expected to cross 4,500 MW by 2030, which in turn is likely to translate into a real estate footprint of around 55 MSF in the next five to six years.

This potential growth is supported by established global connectivity through submarine cables, availability of land and power at comparatively lower costs, supportive government policies and burgeoning demand. Additionally, major DC operators are planning to expand their presence and are committing long-term investments across multiple Tier II/III cities.

India DC market capacity and real estate footprint

Source: Colliers

Data pertains to co-location data centres in the top 7 cities: Bengaluru, Chennai, Delhi-NCR, Hyderabad, Kolkata, Mumbai and Pune | Data centre capacity represents total IT load capacity, including occupied as well as unoccupied space

“With a DC capacity of about 1,263 MW across the top seven markets, India’s data centre industry has witnessed significant scaling up in the last few years. India is becoming a global DC hotspot, fuelled by rapid digitalisation, data localisation norms and strong government support,” says Jatin Shah, COO, Colliers India.

“As this growth trajectory continues, India’s DC capacity is likely to cross 4,500 MW in the next five to six years, translating into a real estate footprint of 55 MSF. Undoubtedly, India’s strategic advantages, such as availability of land parcels, power supply for usage and availability of skilled talent, reinforce its position as one of the preferred destinations for data centres in the APAC region.”

Interestingly, the market is expanding beyond large-scale colocation facilities and hyperscalers to edge data centres driven by an increasing need for lower latency, real-time analysis, enhanced app performance and business agility, he adds.
 
Mumbai drove 44% of the DC capacity additions since 2020

On the supply front, India has witnessed 859 MW of capacity addition across the top seven primary DC markets since the beginning of 2020. In terms of geographical spread, 44 per cent of the new supply since 2020 was concentrated in Mumbai. This was followed by Chennai and Delhi-NCR, which together accounted for 42 per cent of the capacity addition since 2020.
 
In the next five to six years too, a majority of the primary DC markets are set to witness a significant influx of new supply. These Tier I markets are likely to witness 3,000- 3,700 MW of DC capacity additions during 2025-2030, about four times compared to the new supply during 2020-2025.

While Mumbai will continue to dominate the overall DC market, relatively smaller growth markets such as Hyderabad, Bengaluru and Pune are likely to see multi-fold growth in inventory levels. Hyderabad, specifically, is likely to see significant traction and emerge as a major hu in addition to cities such as Mumbai, Chennai and Delhi-NCR.

Supply-side trends in India’s DC market

Source: Colliers

Data centre capacity represents the total designed IT load capacity, including occupied as well as unoccupied space. Data as of April 2025 | Upcoming supply additions are based on announcements made by individual companies across the DC industry.

DCs exceeding 50 MW to account for nearly two-thirds of the capacity by 2030

The rise in proportion of larger-sized DCs (>20 MW) from 42 per cent during 2020 to 56 per cent as of April indicates heightened traction in large hyperscale data centres, especially in recent years.

About 44 per cent of the new supply since 2020 was in the 21-50 MW category. Within the 21-50 MW category, Mumbai drove about three-fourths of the new supply additions.

Interestingly, Chennai accounted for 45 per cent of the new completions during the period in the >50 MW category. DCs will exceed 50 MW capacity and will likely account for nearly two-thirds of the inventory by 2030.

DC industry to see investment worth $20-25 billion over the next 5-6 years

The scale-up in the Indian DC industry has been accompanied by equally impressive investment in the last five to six years. The industry has already seen investment to the tune of $4.7 billion since the beginning of 2020.

This investment has been largely focused on land acquisition, project construction and development, etc. In the next five to six years, amidst massive adoption of cloud computing and AI in India, DCs are likely to attract investments to the tune of $20-25 billion.

“India’s DC market is likely to mature amidst increasing demand, supportive government policies and the country’s continued commitment towards digital transformation. In the coming years, the demand for high-density rack configurations and advanced computing infrastructure will further rise,” says Vimal Nadar, National Director and Head, Research, Colliers India.

“DC investment of about $20-25 billion is likely to materialise in the next five to six years. Operators and developers will increasingly seek land-banking strategies and expand into growing markets with high data consumption levels. Moreover, investment in energy-efficient and green-certified DCs too will gain larger ground as leading players increasingly imbibe sustainable practices. Green penetration in the industry is likely to increase from 25 per cent to 30-40 per cent by 2030,” he adds.