India’s data center industry is on track for significant expansion, with total capacity growing fivefold to 8 GW by 2030, according to an industry report by Jefferies. Growth is expected to be driven by a surge in data consumption, rapid cloud adoption, data localization regulations, and increased use of artificial intelligence (AI) applications.According to the report, the expansion will require an investment of about $30 billion and could increase data center rental revenues fivefold to $8 billion by the end of the decade.Data center capacity in India, where companies lease space and infrastructure from operators, has already grown fivefold to 1.7 GW. According to news agency ANI, the sector is operating at near full capacity, with an average occupancy rate of 97 percent, indicating strong demand.The report added that Mumbai and Chennai together account for about 70 percent of the total installed capacity, with Mumbai alone accounting for about half due to its proximity to submarine cable stations and significant presence of banking and financial services customers.By 2030, Bharti Airtel, Reliance and Adani Enterprises (via AdaniConneX) are projected to account for 35-40 percent of India’s data center capacity. AdaniConneX and Reliance are expected to account for nearly one-third of the planned capacity addition, while the top five players currently dominate 90 percent of the market, led by NTT GDC with about a 20 percent share.The report also notes that the adoption of AI will increase demand, as AI servers consume five to six times more energy and require advanced liquid cooling systems compared to traditional data centers. Regulatory changes such as the Digital Personal Data Protection Act (DPDP) 2023 and RBI’s data localization guidelines are also pushing businesses to store and process data in India.According to Jeffries, the expected $30 billion in capital spending will create opportunities across sectors — including $10 billion in electrical and power systems, $7 billion in racks and finishes, $6 billion in real estate, $4 billion in cooling systems and $1 billion in network infrastructure.
