Blitz Bureau
NEW DELHI: India’s digital infrastructure is poised for a massive expansion, with the country’s third-party data centre (DC) capacity expected to double to 2,400-2,500 megawatt (MW) by FY2028 — up from 1,250 MW in FY2025, a report said on September 25. The expected growth would be driven by a robust investment pipeline of approximately Rs 90,000 crore over the next three years (FY2026-FY2028).
This near-term push is part of a much larger, long-term vision. “Industry players have announced development plans totalling 3.0-3.5 GW to be built over the next 7-10 years, representing a colossal investment of Rs. 2.3-2.5 lakh crore, underscoring the sector’s critical role in India’s ongoing digital transformation,” credit ratings agency ICRA said in its report.
According to the report, Mumbai continues to dominate the Indian DC landscape, contributing to over 50 per cent of the current operational capacity and ranking 21st globally among top cities for DC capacity. The city’s strategic location, reliable power infrastructure, and proximity to the cable landing stations make it a preferred destination for data centre operators. India currently accounts for approximately 3 per cent of the global DC capacity of 42 GW, with the United States contributing around 50 per cent.
This share is expected to rise, driven by increasing data consumption and favourable policy initiatives. “The recent draft proposal of the Ministry of Electronics and Information Technology (MeitY) to provide a 20-year tax exemption policy, if implemented, could be a game-changer for India’s data centre growth prospects. By offering input tax credits on capital investments like construction and electrical systems, the policy aims to lower upfront costs and improve project viability,” said Anupama Reddy, Vice President and Co-Group Head, Corporate Ratings, ICRA.
