The colocation housingHousing facilities are a type of data center … data center market in India is experiencing exponential growth, with a projected annual compound rate of 24.6% between 2023 and 2029. According to the report “India Data Center Colocation Market – Supply & Demand Analysis 2024-2029” published by ResearchAndMarkets.com, the market will increase from an estimated value of $1.2 billion in 2023 to $4.51 billion in 2029.
An Expanding Ecosystem
Currently, India has 109 operational data centers spread across more than 20 cities managed by 25 providers. These facilities have a total capacity of 1,010 MW, reflecting the growing demand for digital infrastructure in the country. Furthermore, 82 new data centers are expected to be built in the coming years, further driving growth in the sector.
Among the leading colocation operators are global and local companies such as NTT Global Data CentersA data center or data processing center (DPC) …, ST Telemedia Global Data Centres, Nxtra by Airtel, Equinix, Sify Technologies, Digital Realty, CtrlS, AdaniConneX, and Yotta Infrastructure.
Key Factors Driving the Market
- Rise of Cloud Computing: The demand for cloud services from providers such as AWS, Google Cloud, Microsoft Azure, and Oracle is driving the hyperscale colocation segment. It is estimated that 75% of the demand will come from the cloud and IT sector by 2029.
- Entry of Hyperscalers and Advanced Technologies: The implementation of Big Data, IoT, AI, and Machine Learning is increasing power density in racks, shifting from the current 3-5 kW to 12-14 kW by 2029.
- Sustainability and Energy Efficiency: Colocation operators in India are adopting sustainable measures to reduce carbon emissions. For example, Nxtra by Airtel has implemented fuel cell technologies using natural gas and plans to shift towards using 50% hydrogen.
Governments and Regional Infrastructure
State government policies, such as the allocation of industrial land for the construction of data centers, play a crucial role in expanding this infrastructure. Areas like Electronic City in Bengaluru, Tidel Park in Chennai, and the Noida Special Economic Zone (NSEZ) are notable examples of the growth of digital infrastructure in India.
Market Outlook and Competitive Dynamics
The report provides a comprehensive view of the current and future market landscape:
- Distribution of Facilities: 109 existing data centers versus 82 new projects in development.
- IT Power Capacity: The market is analyzed in terms of installed, used, and projected power in MW.
- Investment in Connectivity: The increasing implementation of submarine cables and the expansion of cloud on-ramps to strengthen international connectivity is highlighted.
Competition in the market is also evolving with the entry of new players such as Colt Data Centre Services, Larsen & Toubro, and Digital Connexion, adding to the established major players.
Conclusion
The colocation market in India is rapidly expanding due to digital transformation, the growth of cloud computing, and the implementation of advanced technologies. With significant backing from global hyperscalers, India is emerging as one of the most important technology hubs in the world, driving the development of sustainable and high-performance infrastructure.