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India to Need an Additional 1.7-3.6 Gigawatts of Data Center Capacity: Report

India to Need an Additional 1.7-3.6 Gigawatts of Data Center Capacity Report

India has the potential to become a global data center hub due to its low construction, land, and power costs compared to other countries. The country already boasts a well-established IT and digitally enabled services ecosystem. According to Cushman & Wakefield, the median cost of constructing a data center in India is approximately USD 6.8 million per MW of capacity. This is significantly lower than most APAC nations, with Australia at USD 9.17 million, Japan at USD 12.73 million, Singapore at USD 11.23 million, and China at USD 6.84 million. 

Currently, India’s data center capacity stands at 977 MW across the top seven cities. There is an additional 1.03 GW of capacity under construction for 2024-2028, with a further 1.29 GW planned, projecting the total capacity to reach 3.29 GW by 2028. 

“However, what we are building now barely allows us to catch up with more mature markets, indicating the potential for continued investment and growth. We should give data center operators, developers, and investors more confidence in India’s potential for such development,” said Vivek Dahiya, Managing Director & Head Data Centre Advisory Team, Asia Pacific. Cushman & Wakefield’s report suggests that despite a strong projected pipeline of 3.29 GW of colocation (Colo) data center capacity by 2028, India will still require an additional 1.7 to 3.6 GW of capacity beyond the planned 2.32 GW. 

India leads in data consumption, with Indians using over 19GB per month, the highest among comparable nations. Despite this, India lags in internet and smartphone penetration, highlighting the immense potential for growth in the data center sector. 

“India is poised for a data center revolution and has all the necessary elements to become a major global hub. While much attention has been given to supply, our analysis focuses on the demand side of the equation,” said Gautam Saraf, Managing Director, Mumbai, and New Business at Cushman & Wakefield. 

More than 90% of this supply is concentrated in key markets, with Mumbai as the clear leader, followed by Chennai, Delhi NCR, and Hyderabad, which is rapidly emerging as a new data center hub in India. 

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