India’s digital infrastructure is entering a new phase of decentralization, with edge data centre capacity projected to triple to 200–210 MW by 2027, up from 60–70 MW in 20242. This growth is being driven by the proliferation of emerging technologies such as IoT, 5G, AR/VR, and generative AI, which demand real-time data processing and minimal latency.
Edge data centres differ from traditional facilities in scale, location, and speed of deployment. Located closer to end-users, they enable faster data delivery and support localized services. While India is a relatively new entrant in this space, its edge capacity is expected to rise from 5% to 8% of total data centre capacity by 2027.
According to Anupama Reddy, VP & Co-Group Head at ICRA, “Edge and traditional data centres will operate in a hub-and-spoke model, enhancing efficiencies across sectors like healthcare, banking, agriculture, defence, and manufacturing”.
Despite the promising outlook, challenges persist. Security vulnerabilities, especially in Tier II and III cities, rapid tech obsolescence, and a shortage of skilled professionals in remote areas could hinder deployment. Additionally, higher capex per MW and premium rentals—due to their retail-facing nature—make edge centres costlier than traditional hyperscale facilities.
Still, the momentum is strong. Global edge capacity stands at 10% of total data centre capacity, with the US leading at 44%, followed by EMEA at 32% and APAC at 24%. In India, players like RailTel and telecom operators are expected to lead the charge, capitalizing on the expanding cloud ecosystem and demand for low-latency services.
As India’s digital economy scales, edge data centres will become critical pillars of infrastructure—supporting everything from smart cities to autonomous systems. The next two years will be pivotal in shaping this transformation.
