India's data centre (DC) market is poised for exponential growth, with investments estimated to surpass $100 billion by 2027, according to a CBRE report. The demand is driven by increasing digitalization and robust investment in the digital infrastructure in major IT Hubs.

Mumbai, India's largest data centre market, boasts over 600 MW of live capacity, comprising about 49% of the overall DC market. Followed by Chennai, Delhi-NCR and Bangaluru which together constitutes 90% of the country's DC market in the first half of financial year 2025, the report says.

Major hubs in the country include Maharashtra and Tamil Nadu thanks to the strategic infrastructure like multiple cable landing stations, industrial townships and supportive policies in these states.

As of September 2024, India's data centre stock stood at approximately 1,255 MW   and is projected to reach around 1,600 MW by the end of the year. Looking ahead to 2025, an additional 475 MW of capacity is under construction, with Mumbai and Chennai expected to lead the supply additions, Mint reported.

According to the CBRE report, DC inventory is expected to surge due to strong demand from banking, financial services and insurance companies, hyperscalers, and media segments supported by international/domestic network connectivity and the government.

International investors planning major developments in Greater Mumbai (Navi Mumbai) include Blackstone, Digital Edge, Digital Connexion and Princeton Digital Group, it added.

According to a Cushman & Wakefield update report on APAC Data Centres India observed the second- highest increase in operational capacity at 28%, between H2 2023 and H1 2024, behind Malaysia which achieved 80% capacity.

"Japan, India and Australia are the countries wherein both cloud service providers and colocation players are expected to increase their investment and capacities with both Japan and India breaching 4GW size (overall stock of operational, under construction and planned capacities) and Australia at 3.5GW, with Chinese Mainland up ahead of all markets with 6.5GW," the report said.

Generative AI adoption in the country is anticipated to contribute $400 billion to the economy by 2030, significantly boosts the demand for DC infrastructure. 

"Generative AI deployments are also fuelling demand. Both established domestic and global operators are expanding in the market," the CBRE report said. 

The sector is also supported by state-level incentives classifying DCs as essential services, ensuring a streamlined growth trajectory. Maharashtra, Tamil Nadu, Telangana and other major states have dedicated policies to promote DC investments in their states.This infrastructure surge highlights India's potential as a global digital leader, drawing further interest from tech, BFSI, and media sectors.