Rising digital technology in India has increased growth of datacenter industry in the country. As per the S&P Global Market Intelligence, the datacentre market in India is increasing in a three-fold faster compared to the global market, aligning with China’s growth. According to the 2020 India Leased Datacenter Market Report by 451 Research, which is a subsidiary of S&P Global Market Intelligence, the rapidly growing region of datacenter in the world is Asia-Pacific, growing at a CAGR of 10 percent, from 2017-2022.

According to the firm, with the growing datacentre industry at a CAGR of 7 percent, India’s datacentre industry is expanding at 23 percent correspondingly. This development is caused due to several factors, which includes the impending data sovereignty laws under the Data Protection Bill. It will mandate certain class of data to be stored within the Indian borders. The government-backed initiatives and incentives like allowing global digital companies to conduct business and set up servers in India, government programs like the Digital India Programme also contributed to this.

The Principal Research Analyst at 451 Research, S&P Global Market Intelligence, said, “Digital initiatives from the government and enterprises will continue to draw more technology and datacenter companies to India and accelerate market growth in the region. We expect an influx of datacenters will come online in the next few years, where the increased competition will certainly result in better, high-quality facilities in the market and more competitive pricing.”

The report’s key findings included in the report states that 88 percent of India’s supply is in large metro cities like Mumbai, Bangalore, New Delhi, and Chennai. It increased compared to the previous year because of increased infrastructure disparities.

The commercial and financial center of India and International Subsea destination, Mumbai, which hosts almost 40 percent of India’s datacentre colocation market, is the highest in India. After that New Delhi (CAGR 10 percent in 2017-2023) and Bengaluru (CAGR 16 percent in 2017-2023) share the third of India’s datacentre market at almost 34 percent followed by Chennai as the fourth biggest datacentre in India (CAGR 19 percent in 2017-2023).

By 2022, the Indian digital economy, as predicted, will reach $1 trillion. It will attract various global players and the growth of the datacenter industry in India will be advantageous for the potential global digital companies looking to expand their operations in India.