Due to the rising demand for cloud services, digital transformation and the development of data-hungry technologies including machine learning, IoT and AI, the market size for the India Data Centre Market is valued at USD 5.65 billion in FY2023 and is expected to reach USD 19.48 billion by FY2031. The development of the IT sector which is influenced by several government initiatives including Make in India is one the major factors boosting the market growth.

Moreover, the market is projected to register a robust CAGR of 17.01% during the forecast period (FY2024-2031F) on account of the rise of remote learning, digitization of business operations and increased adoption of digital technology by small and medium enterprises. Furthermore, the growing demand for data storage and processing emergence of new technologies has contributed to the market progress. The rise of e-commerce and the usage of social media have led to an increase in the number of data centres in India. Also, the rising demand for online services is being driven by the rising number of internet and mobile users in India.

Another important element boosting market expansion in India is favourable government assistance in the form of tax incentives. The governments of Telangana, Gujarat, Andhra Pradesh and Maharashtra are offering substantial incentives for the establishment of data centres. For instance, the government of Andhra Pradesh declared that it will offer a 50% SGST refund on the procurement of raw materials and equipment for a period of three years after the date the project was approved. As a result, increased government funding is anticipated to have an impact on the growth of data centres in India.

Easy Adoption of Cloud Services

The need for data processing and storage is rising as many emerging businesses are transitioning to cloud-based services. Data centres offer dependable, secure storage and processing solutions, thereby benefiting market growth. Many small and medium-sized businesses are switching to cloud-based services as it declines expenditures related to infrastructure, maintenance and other.

Cloud service in India is so robust and easy to achieve that almost everyone in the country has at least 1 cloud storage provider. All email service providers including Google, Microsoft and Yahoo provide at least 5GB storage free for life; similarly, all mobile phone companies, telecom service provider, broadband service provider, firewall and antivirus providers are also providing cloud service for either free or charge a nominal fee for the same.

Classification of Data Centers as Assets

The Government of India announced to classify Data Centers as Assets class from 1st April 2022, which made it easier for data center firms to raise funds and has already impacted the Indian market positively. In May 2023, Andhra Pradesh Government approved setup of a new data center in a tech park in Vizag, fueled by Adani Group and shall cost USD 2.7 billion (Rs. 21,844 Crore). In Vizag Tech Park, 2 data centers will be established a 200 MW Integrated Data Centre at Madhurawada and another one of 100 MW at Kapuluppada.

Government Initiatives Have Propelled the Growth

According to the Ministry of Electronics and Information Technology (MeitY), the "Digital India" plan is expected to increase the nation's digital economy to USD 1 trillion by FY2025. As technology advances, so does the amount of data created and the need for data centres. Moreover, with the rollout of 5G technology in the nation, data is anticipated to grow much faster, thereby impacting market growth.

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Impact of COVID-19 on India Data Centre Market

The pandemic has had a significant impact on the India data centre market. The operations and the data centres’ role in supporting the digital economy has affected the market. A considerable growth is witnessed in demand for digital services, such as online shopping, streaming video and video conferencing, as more individuals are opting for work from home. Data centre capacity has been in demand because of the rise in data traffic. On other hand, the pandemic disrupted supply chains, which caused delays delivery of components and equipment. Furthermore, people were hesitant to work in close proximity to others, which made it challenging to maintain staffing levels.

Impact of Russia-Ukraine War on India Data Centre Market

Although India has maintained cordial ties with both Russia and Ukraine, but the escalation of hostilities between the two nations has affected India's IT industry by disrupting international commerce, investment and project flow. The conflict between Russia and Ukraine has caused supply chain disruptions which have affected the availability and cost of data centre components and equipment in India. The outcome of the war and how it develops over time will determine how it affects the India data centre market.

Report Scope:

“India Data Centre Market Assessment, Opportunities and Forecast, FY2017-2031F”, is a comprehensive report by Markets and Data, providing in-depth analysis and assessment of the current state of affairs of the data centre in India, industry dynamics and challenges. The report includes market size, segmental shares, growth trends, COVID-19 and Russia-Ukraine war impact, opportunities and forecasts (FY2024-2031). Additionally, the report profiles the leading players in the industry mentioning their respective market share, business model, competitive intelligence, etc.

In this report, India Data Centre Market has been segmented into the following categories: 

1.       India Data Centre Market, By Type

1.1.   Tier I

1.2.   Tier II

1.3.   Tier III

1.4.   Tier IV

2.       India Data Centre Market, By Model Type

2.1.   Enterprise (On-Premises)

2.2.   Outsourced (Managed Data Centres and Colocation Facilities, Cloud Data Centres)

3.       India Data Centre Market, By Infrastructure Components

3.1.   Servers

3.2.   Storage Systems

3.3.   Networking

3.4.   Others

4.       India Data Centre Market, By Enterprise Size

4.1.   Small and Medium Enterprises

4.2.   Large-Scale Enterprises

5.       India Data Centre Market, By End-User

5.1.   IT and Telecommunications

5.2.   BFSI

5.3.   Aerospace Defence

5.4.   Media and Entertainment

5.5.   Retail

5.6.   Energy and Power

5.7.   Healthcare

5.8.   Others

6.       India Data Centre Market, By Region 

6.1.   North

6.2.   South

6.3.   East

6.4.   West & Central

Key Players Landscape and Outlook

Information is the most vital component for any business, which is stored as Data. Organizations consider various aspects before choosing any data centre including reliability, location, scalability, network services capacity and security are some important considerations. Many companies operate in India data centre market including NTT Limited (Nippon Telegraph and Telephone Ltd.), CtrlS Datacenters Ltd., Nxtra Data Ltd. (By Bharti Airtel Ltd.) and Equinix, Inc. 

Markets and Data’s reports answer the following questions:

·         What is the current and future market size of the product/service in question globally or specific to different countries?

·         How are the markets divided into different product/service segments and the market size and growth of each segment?

·         What is the market potential of different product segments and their invest case?

·         How are the markets predicted to develop in the future and what factors will drive or inhibit growth?

·         What is the business environment and regulatory landscape specific to the product/service?

Key Players Operating in India Data Centre Market

·         NTT Limited (Nippon Telegraph and Telephone Ltd.)

·         CtrlS Datacenters Ltd.

·         Nxtra Data Ltd. (By Bharti Airtel Ltd.)

·         Equinix, Inc.

·         Web Werks India Pvt. Ltd.

·         Amazon Web Services, Inc.

·         STT Global Data Centres India Private Limited 

·         Sify Technologies Limited

·         Google Cloud India Private Limited

·         AdaniConnex Private Limited

·         Yotta Data Services Private Limited

·         Microsoft Corporation (India) Pvt. Ltd. (Microsoft Azure)

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