In response to the evolving needs of the digital industry, the Indian government is considering a revision of its 2020 data centre policy draft. According to ET CIO, data centres could soon be awarded infrastructure status, similar to other critical sectors like railways, roads, power, and ports.
The Ministry of Electronics and Information Technology (MeitY) is reportedly planning to offer enhanced incentives for companies looking to establish cutting-edge machine learning (ML) and artificial intelligence (AI) data centres. These incentives would support the development of larger and more cohesive frameworks within shared locations, reflecting the growing significance of ML and AI in the tech landscape.
“The current cumulative capacity of all data centers pan India is roughly 950 megawatts (MW) and there is an opportunity to double this in the next two-three years. We estimate that the investment opportunity in data centres is likely to touch roughly $6 billion to $7 billion by 2026,” as quoted by a government official to ET CIO.
As per the new policy, the states are incentivized to provide dedicated zones to set up data centre parks, so that the companies can handle the costs affiliated with capital, power, and operational expenses.
“We will also start talking to the power ministry on the options for uninterrupted power supply and whether these data centers can be allowed to draw power from other states or the open market instead of the state or union territory they are domiciled in,” said the resource. “One option is to incentivise the states or the data centre parks themselves to set up captive power generation units.”
Notably, in 2020, the Ministry of Electronics and Information Technology (MeitY) introduced a Data Centre Policy that aimed to streamline the entry of new players into the sector by proposing a single-window clearance process. Additionally, the policy suggested incentives for companies that used domestically manufactured IT hardware, including storage, servers, and network devices. This draft was made available for public discussion.
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