Mumbai, India, September 18, 2025- India’s data centre industry is witnessing a fresh wave of investor excitement, with analysts projecting a fivefold jump in capacity over the next five years. The sector, already driven by soaring internet traffic, AI adoption, and data localisation rules, is now being hailed as a potential INR 5 lakh crore (USD 60 billion) investment opportunity on Dalal Street.
Brokerage firm Jefferies estimates that India’s total data centre capacity could expand to nearly 8 gigawatts (GW) by 2030, requiring close to INR 2.5 lakh crore (USD 30 billion) in capital expenditure for facility buildouts. Leasing revenues are also expected to multiply in tandem, mirroring the growth in installed capacity.
“This is not just about servers and storage, but the backbone of India’s digital economy over the next decade,” Jefferies noted in its outlook.
The growth story is already taking shape. According to rating agency ICRA, India’s operational capacity is likely to rise from about 1,150 megawatts (MW) at the end of 2024 to 2,000-2,100 MW by March 2027. The agency also expects investments of INR 40,000-45,000 crore (USD 4.8-5.4 billion) during the FY2026–27 period alone, with edge data centres, smaller, distributed hubs, tripling capacity to about 200 MW in the same window.
Driving this momentum are rising data demands from streaming, e-commerce, fintech, and AI workloads. Regulatory pressures, particularly data-localisation mandates, are forcing companies to host more infrastructure within India’s borders.
Industry heavyweights like Reliance Industries, Bharti Airtel, and AdaniConneX are tipped to lead the charge, together controlling as much as 40% of the country’s capacity by 2030.
But while the headlines highlight a massive boom, experts caution that the sector’s rewards will be unevenly distributed. Power availability, cooling efficiency, land costs, and regulatory hurdles remain significant challenges. Firms with strong balance sheets, scalable infrastructure, and proven execution models are expected to outperform, while others may struggle to keep pace.
For investors, the data centre buildout represents both a digital infrastructure plays and a test of execution discipline.
As one market analyst put it,
“The opportunity is huge, but in this race, not every horse will finish.”
