India’s Data Centre Sector May Draw $23 Billion By 2030

The data centre ecosystem is set to boom as artificial intelligence (AI) drives technological advancement. India is expected to be a major beneficiary of this trend.

India’s data centre ecosystem may create a $23 billion investment opportunity over the next five years due to rising AI adoption, which is expected to drive the deployment of 650,000-700,000 GPUs in the country, said Avendus Capital, an investment bank.

Graphics processing units (GPUs) are the building blocks of data centres that process data at high speed to support AI capabilities.

India’s data centre capacity is expected to grow at a compound annual growth rate of over 26 percent in the next five years, the investment bank said in a report on data centres.

According to the report, India’s built data centre capacity is expected to surge from 1.6 GW last year to 5 GW by 2030.

This growth will be driven by infrastructure demand as AI adoption increases along with rising cloud and digital requirements.

Data centre developers currently have an active pipeline of over 3 GW, which would require capital allocation of about $25 billion over the next five years. This also includes 1 GW of AI data centre capacity.

According to the report, Mumbai will emerge as the country’s main data centre hub.

The city is expected to contribute around half of India’s total installed and upcoming data centre capacity over the next five years.

Globally, data centres have emerged as a major driver of investment and economic activity.

According to the United Nations Conference on Trade and Development (UNCTAD), data centres accounted for more than one-fifth of global greenfield project values in 2025, with announced investments exceeding $270 billion.

Rapid growth in AI computing demand and data-intensive digital services is intensifying global competition to attract such infrastructure.

To encourage growth in data centre capacity, the government announced a tax holiday till 2047 for eligible foreign cloud service providers operating through India-based data centre infrastructure.