India’s data center (DC) industry is on the brink of exponential growth, with total capacity expected to reach 3 GW by 2030, according to a new thematic report released by Avendus Capital.
Titled “A Multi-Year Growth Proxy on India’s Data Explosion and Localization Wave,” the report projects a 25–30% compound annual growth rate (CAGR) for the sector—underpinned by rising data consumption, AI and cloud adoption, and policy initiatives focused on data localization. Avendus Capital Pvt. Ltd is a leading financial services firm offering research-driven solutions across financial advisory, capital markets, wealth management, and alternative asset management.
The report further says that subsidized land banks and electricity duty exemptions by various state governments are emerging as key enablers for accelerating data center capacity expansion across India. Low capex/electricity cost, uninterrupted power supply and improved capabilities could result in India becoming preferred destination for DCs, however, it is further projected that by 2033, country will be requiring data center capacity of approx. 6043 MW but supply is expected to be only 4501 MW, a short supply/gap of approx. 1542 MW till 2033.
Among the players gearing up to tap this high-growth environment is Delhi-NCR-based Infrastructure & Real Estate player Anant Raj Limited. Through its 100% subsidiary Anant Raj Cloud, the company is retrofitting existing IT Parks in Haryana’s Manesar, Rai, and Panchkula into Tier-III and Tier-IV compliant data centers. Backed by a planned capex of $2.1 billion, the developer aims to achieve an operational capacity of 307 MW by 2031-2032 from 28 MW IT Load in 2025-26.
“In today’s data-driven economy, the data center industry sits at the confluence of real estate, technology, and infrastructure. Our investments are aligned with this vision—to create secure, scalable, and sustainable infrastructure that powers India’s digital ambitions. With the advantage of pre-zoned sites, strong government policies, robust power access, and connectivity, we are well-positioned to meet the rising enterprise and hyperscaler, Cloud- Infrastructure as a Service demand from both public and private sector clients,” said Amit Sarin, Managing Director, Anant Raj Limited.
The report states how India, despite accounting for nearly 20% of global mobile data consumption, currently contributes only ~3% to global data center capacity. This imbalance is narrowing rapidly as both domestic and global hyperscalers increase their presence in India, bolstered by low capex/opex costs, improving infrastructure, and supportive policy frameworks such as the Digital Personal Data Protection (DPDP) Act.
While established leaders such as STT GDC, and Sify continue to anchor the market, a new wave of entrants is reshaping the competitive landscape. Anant Raj Cloud with planned capacity of 307 having a mix of Co-location and Cloud Services geared to meet rising enterprise demand. Leasing activity, according to the report, has quadrupled over the last five years, driven by verticals like BFSI, OTT, gaming, e-commerce, and public governance which includes state governments and central government departments, public sector enterprises and undertakings.
The sector is also seeing a surge in annual investments—currently at $1–1.5 billion—which are expected to double in the coming years. Much of the demand is expected to be met through large-format, hyperscale-ready infrastructure in core markets, alongside edge-ready capacity in Tier 2 and Tier 3 cities for latency-sensitive workloads.
Colocation remains the preferred business model, providing annuity-like returns through long-term contracts with hyperscalers and public & private enterprises. Operators offering a balance between scale, energy efficiency, and a diversified client base are expected to outperform.
Beyond core infrastructure providers, the report also highlights the broader ecosystem poised to benefit. Firms involved in electrical systems—such as ABB, Mitsubishi, Schneider, Cummins, and Siemens—as well as cooling solution providers like Blue Star and Vertiv, are expected to see continued demand for critical infrastructure like diesel gensets, UPS, chillers, and DCIM tools. Optical fiber players such as HFCL and Sterlite, and EPC contractors like S&W and KEC International, are similarly well-positioned.
As India advances toward becoming a digitally empowered economy, the data center industry is set to emerge as a foundational pillar—enabling speed, resilience, and capacity in an increasingly connected world.
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