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Datacentre Investments – The India Advantage

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India’s datacentre market is well poised to in coming years reaching ~$5 billion by 2025 driven by India’s growing data economy and an increasing focus on data protection and data localisation policies (Read the blog Datacentres – The India Growth Story for more details).

Datacentre Investments – The India Advantage

Apart from these key drivers there are certain specific advantages that India brings in making it a preferred choice compared to other locations. These include:

  • Increased focus on Tier IV Standards:
    • Majority of the upcoming investments in datacentres are for Tier IV standards (the highest rating in datacentre standards), certified by the Uptime Institute in India.
  • Cost Advantage:
    • In India, cost of developing a Tier III datacentre costs around $3.0–$3.5 million, while for a Tier IV datacentre it is around $4.5-$5.0 million. This is 50%20 cheaper compared to major global markets such as the US, the UK, Germany, Singapore, Hong Kong, and Japan.
  • Skills
    • Engineering skill shortage is a major challenge in developed datacentre markets such as the North America and Western Europe, where it is a benefit for India to position itself as a major datacentre hub
  • Location Advantage
    • India has a huge data consuming market, a growing submarine cable connectivity system, and a fairly stable geography (with most cities not prone frequent earthquakes/other natural disasters). These factors coupled with the increasing shift towards cloud makes India a hotspot for datacentres


Major Datacentre Locations in India

The major markets

Majority of the datacentres in the country are concentrated in Tier 1 cities namely, Mumbai, Chennai, Bengaluru, Hyderabad, Delhi as they offer good fibre connectivity, proximity to customers, availability of skilled workforce, and submarine cable connectivity.

Major Datacentre Locations in India

Source: NASSCOM’s Report “India – The next datacentre hub

The upcoming locations

Kolkata and Pune are key upcoming cities as the demand across these locations is driven by digital transformation initiatives by government, improvement in terrestrial network connectivity, and proximity to customers.

To read more about the India investment advantage, key selection criteria that favour invesment growth in upcoming locations and the key site selection criteria for datacentre, read our recently released report “India – The Next Datacentre Hub”.


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