India Tops in Foreign Investment in Data Centres.

A recently published CII Colliers report ‘India Data Centers: Entering Quantum Growth Phase’? says that data centres are likely to attract investments of $10 billion in the next three years. Mumbai leads, followed by Chennai and Hyderabad.? Currently, India has 138 data centres and tops in foreign investment in data centres, globally.

The need for data centres is increasing manifold, with the rise of data consumption, and growing cloud usage. Many foreign and domestic investors are seeing a big opportunity in India. According to the report “as of August 2023, the data centre capacity across the top 7 cities stands at 819 MW, spread across 11.0 million sq feet”.

Leading global player Colt DCS opened their first data at Navi Mumbai last month. Other major investors include Amazon Web Services, NTT Global Data Centres, ST Telemedia Global Data Centres India, CtrlS, and Yotta Infrastructure, Bharti Airtel among others. Google Cloud and Microsoft are also investing. ?Sydney-based software company Atlassians' plans to invest in collaboration with Amazon.

The Adani Group is developing an integrated data centre and technology business park in Vizag, Andhra Pradesh. AdaniConneX is a 50:50 joint venture between Adani Group and EdgeConneX. It would have a data centre, technology and business park, and skill development centre and would be powered with up to 100% renewable energy, connected with robust terrestrial and submarine infrastructure to help the deployment of cloud and emerging technologies in the region. The integrated facility will be one of India's largest hyperscale data centres.

The key factors that are driving the growth of data centres in India are

·??????? Exponential increase in demand for data and high bandwidth due to the increase of smartphone users

·??????? Cloud adoption and digital transformation

·??????? Available skilled workforce

·??????? Government’s mega push for digital infrastructure

·??????? Relatively lower real estate costs

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The Ministry of Electronics and Information Technology (MEITY) Govt of India, has given data centres an infrastructure status, just like railways, roadways etc. The Data Centre Policy 2020 aims to have a seamless approval process as well. Data centre services may benefit from tax breaks in states like Maharashtra, Karnataka, and Uttar Pradesh, as well as energy subsidies and discounts on land costs.

Key requirements to build a data centre are – space to hold all the IT infrastructure, uninterrupted power supply with a backup system, cooling to keep the hardware at safe temperatures, security measures and good data centre management tools and capabilities. One of the important variables is the vicinity of fibre landing posts and Mumbai is one of them.? No doubt that Mumbai leads the data centre market in India.

A very visible trend is the emphasis on sustainability by adopting energy efficient, low-carbon technologies, and renewable energy. ‘Edge data centres’ have a lower energy consumption and a smaller footprint. They are smaller and located at the edge of a network and closer to end users and devices. Tier-II cities like Vijayawada, Nagpur, Raipur, Kochi, Patna, and Mangalore are being eyed by key data centre operators for the establishment of edge data centres and disaster recovery sites.

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Hyperscalers

Global Hyperscalers are looking at India as a prime market. They are looking to build their own (Build to Suit (BTS) centre facilities. Data localization mandates by the government have led to regional presence by the MNCs, big tech companies, and e-commerce giants. Large enterprises like banking institutions, telecom companies, retail/e-commerce companies and MNCs servicing clients in India need hyperscale data centres. This year there have been commitments from global hyperscalers in India’s data center space. As technologies advance, and as spectrum bandwidth keeps increasing, so is the usage of data.?