India data centre capacity set to jump fivefold to 7.5 GW by 2030, Crisil says

India's data centre capacity is projected to expand fivefold to around 7.5 gigawatts by March 2030, drawing in more than Rs 3 lakh crore of investment over the next four financial years, according to a report by Crisil Ratings.

The surge reflects the country's rapid digital infrastructure expansion, driven by the adoption of generative artificial intelligence, enterprise digitalisation and steady increases in domestic data consumption. Strong demand from global hyperscalers—large cloud service providers—is helping de-risk the build-out, with developers securing long-term customer commitments before breaking ground.

Nearly half of the incoming capacity is already locked under long-term contracts, limiting speculative building. For projects currently under construction, more than 95 per cent of capacity has already been contracted, while existing operational data centres across the country are running at around 90 per cent utilisation.

India's cost structure gives it a distinct edge over competing regional hubs across the Asia-Pacific region. Development costs are roughly one-fifth lower, supported by competitive prices for land, construction and labour, alongside lower power tariffs.

"India's structural cost advantages further strengthen its attractiveness as a data centre destination," said Anand Kulkarni, Director at Crisil Ratings. He added that the ability to set up large campuses powered by renewable energy aligns directly with the sustainability goals of global tech firms.

The nature of client agreements has also matured. Contract durations have extended to 15 or 20 years, up from 10 to 12 years previously, giving developers predictable cash flows over longer horizons. Nitin Bansal, Associate Director at Crisil Ratings, noted that high migration costs and rising replacement expenditure will help keep clients anchored, though developers must continually upgrade facilities to handle higher power density and advanced cooling for AI workloads.

Growth will be heavily concentrated in three major coastal and industrial hubs. Visakhapatnam, Mumbai and Hyderabad are expected to host nearly three-quarters of the upcoming 6 gigawatts of planned capacity additions. By fiscal 2030, the power demanded by data centres in these cities could reach the equivalent of 80 per cent of Visakhapatnam's current peak electricity demand, 60 per cent of Mumbai's, and 20 per cent of Hyderabad's.

Crisil Ratings noted that hyperscalers will likely account for 75 to 80 per cent of total leased capacity by fiscal 2030, up from 60 to 65 per cent in fiscal 2026. While this concentration increases dependency on tech giants, the sector's high utilisation rates and long-term pre-leasing provide a solid financial foundation for India's digital build-out.