India is experiencing a surge in data centre land transactions, driven by growing demand and expansions by data centre operators and hyperscalers (large data centre) acquiring land across key cities.
According to data from Savills India, over 200 acres of land were acquired in Mumbai, Hyderabad, Pune, Chennai and Bengaluru in 2024 underlining the growing demand for data centres in the country.
Data showed that India added 191 MW (Mega Watt) IT capacity across top cities in 2024 even as the data centre market is set to add a total IT capacity of over 600 MW and absorption of over 450 MW IT capacity in 2025. India witnessed an absorption of 407 MW of IT capacity across key cities in 2024.
Market projections highlight that the data centre stock is likely to grow at a CAGR of 21% during calendar year 2024 and 2030 and will touch 3,400 MW of IT capacity by 2030 even as the operational capacity currently rests at 1,110 MW of IT capacity.
Experts said that the growing demand for data centres is driven by factors such as Artificial Intelligence (AI), the expansion of big data, the rapid growth of e-commerce and digital transformation initiatives and the growing adoption of cloud computing.
Data showed that Mumbai micro-market spearheaded the data centre absorption with 53% share of total absorption, followed by Hyderabad at 14 percent, Chennai at 10% and Pune at 10%. Absorption and supply were mostly focused in Mumbai, Chennai, Hyderabad, and Pune micro-markets.
Market observers pointed out that BFSI (Banking, Financial Services, and Insurance), IT & ITeS, hyperscalers, and service sectors, have propelled the demand for data centres as all of these depend deeply on data centres.
Savills data showed that Tier-II and Tier-III cities are driving the demand for edge data centres or smaller data centres.
Experts said that expansion of 5G services and growing use of mobile applications are motivating demand for edge data centres in Tier-II and Tier-III cities such as Jaipur, Kochi, Vizag, Coimbatore, Lucknow, Madurai, Raipur, Hubli and Bhubaneswar, Patna.
