India’s Data Centre Industry to Double Capacity by FY27

According to a recent Crisil Ratings report, India's data centre capacity is expected to increase to 2-2.3 GW by FY27, driven by accelerated digitalisation and enterprise investments in cloud storage solutions.

Key Points

Role of Generative AI (GenAI): The growing adoption of GenAI, requiring high computational power and ultra-low latency, is a key driver of data centre demand.
Stable Financial Outlook: Crisil predicts stable cash flows and strong credit profiles for players in the data centre industry, bolstered by government policies and state-level incentives.
Investment Surge: Rs. 55,000-65,000 crore in investments will be required over the next three fiscal years, focusing on land, buildings, power equipment, and cooling solutions.
Drivers of Demand: The shift to digital platforms and increased internet usage, including OTT streaming, social media, and digital payments, has propelled demand for data centres.
Mobile Data Growth: Mobile data usage has grown at a CAGR of 25% over the past five years, with monthly usage projected to reach 33-35 GB per user by FY26.
Expansion by Operators: Existing and new data centre operators are scaling capacity, supported by hyperscalers catering to businesses with extensive digital infrastructure needs.