India’s Data Center Colocation Market to Grow at 25% CAGR

India’s data center colocation market is set to witness robust growth over the next few years, with a projected compound annual growth rate (CAGR) of 25.24% between 2024 and 2030, according to a recent report by ResearchAndMarkets.com.

The report, titled “India Data Center Colocation Market – Supply & Demand Analysis 2025-2030”, offers detailed insights into the supply and demand dynamics shaping the industry.

Colocation refers to third-party data centers that provide businesses with space, power, cooling, and physical security to house their servers and IT infrastructure. The report tracks the market size in terms of utilized white floor area, IT power capacity, and rack count, providing a comprehensive overview of the current and future industry landscape. It also distinguishes between Core & Shell, Installed, and Utilized IT Power Capacity, along with occupancy levels across facilities.

India’s colocation sector is currently supported by rapid digitization, increasing adoption of cloud services, and the need for scalable and secure IT infrastructure. The report indicates that colocation demand is expected to grow across industries, driven by sectors such as IT services, BFSI, e-commerce, and government organizations. Cloud operations, both current and future, are also playing a pivotal role in shaping the market’s expansion.

In terms of infrastructure, India hosts 120 existing and 87 upcoming third-party data center facilities spread across more than 15 states. These facilities vary in size and capacity, with comparisons provided for white floor area and IT load capacity. The report highlights that the colocation market includes both retail and wholesale services, with detailed analysis of revenue trends, pricing structures, and add-on services for customers.

Sustainability has become a key focus for data center operators, and the report examines the current status of energy efficiency and green initiatives across the market. As India expands its digital infrastructure, operators are increasingly prioritizing renewable energy usage and efficient cooling technologies to reduce environmental impact while maintaining high uptime and reliability.

The study also explores market opportunities and potential restraints, providing stakeholders with insights into emerging trends, such as submarine cable deployments and regional expansions. In addition, it assesses the competitive landscape, including industry share by IT power capacity and revenue, and profiles major colocation operators based on facility count, floor space, and IT capacity.

Experts note that India’s data center colocation market is entering a phase of accelerated growth, driven by the government’s push for data localization, increasing cloud adoption, and rising demand for managed IT services. The availability of reliable and scalable colocation options is expected to attract both domestic and international clients, particularly in metropolitan hubs like Mumbai, Delhi NCR, Bengaluru, and Hyderabad.

With a combination of strong investment, technological adoption, and regulatory support, the Indian colocation market is poised to become a critical backbone for the country’s digital economy. Businesses seeking secure, flexible, and efficient data hosting solutions are likely to benefit from the expanding network of colocation facilities in the coming years, making India a key destination for data center growth in Asia.