India’s data centre market, valued at $7 billion in 2023, is poised for significant growth, with a CAGR of 8 percent, expected to reach $8 billion by 2025, according to a report from 1Lattice.
Indian data centre capacity is projected to increase from 1,150 MW in 2023 to 1,700 MW by 2025, reflecting a robust 22 percent growth rate.
Major cities such as Mumbai, Delhi-NCR, and Bengaluru have emerged as key hubs for data centre colocation services, accounting for over 55 percent of the country’s total capacity. This expansion is fueled by the rising demand for data consumption, advancements in emerging technologies, and strong governmental support.
“The surge in data consumption, the rise of emerging technologies, and strong government support are converging to make India one of the fastest-growing data centre markets in the world,” said Abhishek Maiti, Director – Technology and Internet at 1Lattice.
Investments in infrastructure, technology, and sustainability are expected to be major drivers of growth.
Globally, the data centre market is projected to grow from $227 billion in 2023 to $250 billion by 2025, driven by the adoption of cloud computing, edge technologies, and artificial intelligence (AI) and machine learning (ML).
India’s data centre sector has witnessed remarkable growth, doubling its capacity from 540 MW in 2019 to 1,011 MW in 2023. The country also saw a 21 percent increase in data centre absorption in the first half of this year, with rising demand from tier 2 and 3 cities, particularly for edge data centres. India has the potential to add another 500 MW of capacity over the next four years, solidifying its position as one of the fastest-growing markets globally.
