India’s data center (DC) market has entered a transformative phase and has scaled up significantly in recent years.
DC capacity has grown over 4X times in the last 6-7 years and stands at 1,263 MW as of April 2025. This growth is driven by the surge in demand for digital & cloud services, increasing adoption of Artificial Intelligence (AI) & Internet of Things (IoT), and higher internet penetration, supported by favorable government policies.
At the city level, Mumbai continued to account for majority of the DC capacity with 41% share, followed by Chennai & Delhi NCR at 23% & 14% respectively. This rapid expansion in capacity has resulted in over 3X times increase in real estate footprint over the last 6-7 years, across top seven DC markets of the country, taking it to 16 million sq ft as of April 2025.
The scale-up in Indian DC industry has been accompanied by equally impressive investments in the last 5-6 years. The industry has already seen investments to the tune of USD 14.7 billion since the beginning of 2020. These investments have been largely focused on land acquisition, project construction & development etc. In the next 5-6 years, amidst massive adoption of cloud computation and AI in India, DCs are likely to attract investments to the tune of USD 20-25 billion.
According to the recent Colliers’ report, DC capacity across the top seven cities is expected to cross 4,500 MW by 2030 which in turn is likely to translate into real estate footprint of around 55 million sq ft in the next 5-6 years.
This potential growth is supported by established global connectivity through submarine cables, availability of land & 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.
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% of the new supply since 2020 was concentrated in Mumbai. This was followed by Chennai and Delhi NCR which together accounted for 42% of the capacity addition since 2020.
In the next 5-6 years too, majority of the primary DC markets are set to witness 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 4X 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 multifold growth in inventory levels. Hyderabad, specifically, is likely to see significant traction and emerge as a major hub, in addition to cities such as Mumbai, Chennai & Delhi NCR.
“With a DC capacity of about 1,263 MW across the top seven markets, India’s data center industry has witnessed significant scaling up in the last few years. India is becoming a global DC hotspot, fueled by rapid digitalization, data localization norms and strong government support. As this growth trajectory continues, India’s DC capacity is likely to cross 4,500 MW in the next 5-6 years, translating into a real estate footprint of 55 million sq ft. Undoubtedly, India’s strategic advantages such as availability of land parcels, power supply for usage and availability of skilled talent, reinforces its position as one of the preferred destinations for data centers in the APAC region. Interestingly, the market is expanding beyond large-scale colocation facilities and hyperscalers to edge data centers driven by increasing need for lower latency, real-time analysis, enhanced app performance, and business agility,” said Jatin Shah, Chief Operating Officer, Colliers India.
