India’s Data Center Capacity Additions Surge 59 Percent as Absorption Climbs in First Half of 2026: Savills India
NEW DELHI — New data center capacity additions in India surged to 258 MW IT in the first half of 2026, marking a 59.3 percent year-on-year increase from 162 MW IT recorded in the first half of 2025. According to report data from global real estate consultancy Savills India, the surge has brought the country’s total operational stock to 1.8 GW IT. Absorption reached 278 MW IT during the same period, reflecting a 31.1 percent increase year-on-year, driven primarily by hyperscalers, smaller cloud providers, and large enterprise demand. Hyperscalers remained the dominant demand driver, accounting for over 80 percent of total absorption in the first half of 2026, while over 120 acres of land were transacted for data centers nationwide.
Mumbai and Chennai maintained their positions as the primary markets, collectively accounting for 64 percent of total absorption. Mumbai led the absorption metrics at 38 percent, followed by Chennai at 26 percent, Delhi-NCR at 22 percent, and Hyderabad at 11 percent. On the supply side, Mumbai recorded 55 percent of total new capacity additions, with Chennai contributing 20 percent and Hyderabad accounting for 10 percent, while Tier-II cities made up 7 percent of new supply. Out of the 1.8 GW IT total operational stock, hyperscalers occupied 36 percent, enterprise-focused facilities accounted for 8 percent, edge data centers represented 1 percent, and the remaining 55 percent comprised hybrid facilities serving both hyperscalers and enterprises.
“The Indian data centre market continues to witness sustained growth, driven by both established operators and an influx of new funds and developers, seeking to establish a presence in this sector. While the broader colocation market has experienced relatively moderate demand due to increasing enterprise adoption of cloud services, demand from hyperscalers and large enterprises remains strong and is expected to continue underpinning market expansion. Furthermore, we anticipate emerging demand from Neo-Cloud service providers, many of whom are actively evaluating India as a strategic destination owing to its compelling cost advantages, location agnostic nature, and expanding infrastructure ecosystem. Despite the steady market outlook, facilitation of power and suitable land parcels for DC development, remains a critical challenge across all key data center markets in India, requiring Hyperscalers and DC Operators to explore new clusters for future expansion, with the support of local govt.’s,” said Srihari Srinivasan, Director & Lead – Data Centre Services, Savills India.
Looking ahead, India’s data center capacity is projected to nearly fourfold to reach over 7 GW IT by 2030, supported by policy initiatives, digitalisation, cloud adoption, AI workloads, and data localisation requirements. Both annual capacity additions and absorption are expected to surpass 600 MW IT in 2026, with average annual capacity additions accelerating to between 350 MW IT and 500 MW IT through 2030. While major growth remains concentrated in primary hubs like Mumbai and Hyderabad, infrastructure deployment is also expanding into secondary locations and Tier-II cities, including Vizag, Nagpur, Bhubaneswar, Patna, Lucknow, Jaipur, Kochi, Coimbatore, Madurai, Raipur, and Hubballi.
