Are data centers next BIG business avenue? Governments, firms eye big pie of evolving data hubs | Companies News

India’s digital infrastructure has been witnessing a rapid evolution and with the emergence of 5G, the internet of things and artificial intelligence, the focus is shifting towards physical infrastructure to support this rise. The global data center market is expected to receive an investment of $200 billion per annum by 2025, according to a Nasscom report. The IT ministry also plans to offer incentives worth up to Rs 15,000 crore for data centers under a national policy framework. According to an ASSOCHAM-EY report, India is well-placed to be a global hub for data centers with a projected growth of $8 billion by 2026. States across India are focussing on data centers and promoting investments in the related sector. India’s data center market is projected to double in the next two-and-a-half years from the existing 637 MW capacity to 1318 MW, as per the latest JLL report.

According to reports, Bharti Airtel’s subsidiary Nxtra Data Ltd is investing Rs 600 crore in the development of its largest data center in Kolkata. The center will serve the markets of the east and northeast regions along with the SAARC countries. The company will invest Rs 600 crore to build the 25 MW data center in Bengal Silicon Valley, Kolkata and will be fully operational by 2024. Nxtra is on an expansion spree and will invest over Rs 5000 crore over the next four years to expand its capacity by 3X to over 400 MW. The state government has already earmarked 250 acres for Bengal Silicon Valley in New Town as land demand for data centers by various companies may reach 50 per cent of the total.

Karnataka, West Bengal and Tamil Nadu governments have also signed multiple MoUs with firms to promote establishment of data centres in their states. The Uttar Pradesh government-led by Chief Minister Yogi Adityanath announced in June this year to set up four data centers in the state for Rs 15,950 crore. The government said that it would create 4,000 direct or indirect jobs. The state has already devised a data center policy that provides various incentives like capital subsidy, interest subvention, stamp duty exemption, energy-related financial incentives and various other non-financial incentives. Various developers including NIDP Developers Private Limited, NTT Global Data Centers, Yotta Infrastructure and Cloud Infrastructure India are already in the process of setting up data centers in the state.

Hiranandani Group of Companies’ Yotta Infrastructure has already launched its Yotta D1 center at the Greater Noida Data Center Park in October this year. Both Yotta and NIDP are parts of the Hiranandani Group.

Sunil Gupta- CEO- Yotta Infrastructure, said, “The next two years will witness the launch of a new data center in Gift City, Gujarat, in 2023, followed by the launch of our first data center at the Chennai Data Center Park in 2024. The expansion also entails capacity addition at Navi Mumbai and Greater Noida Data Center Parks. Yotta NM2, our additional data center at the Navi Mumbai campus, will feature 8000 racks capacity. At our Greater Noida campus, we will start constructing two additional data centers, Yotta D2 and Yotta D2, they will have a combined capacity of 11,000 racks.”

Data Centre

The company plans to build data centers in Mumbai, Pune, Kolkata, Chennai and Bangladesh. “Yotta’s investment in setting up the data center park in Kolkata will be around Rs 8,500 crores, whereas the Chennai Data Center Park will involve an investment of more than Rs 4,000 crores. Recently, Yotta also entered into an MoU with the Government of Uttar Pradesh to invest Rs 39,000 crores in the state over 5 to 7 years. This investment will go towards expanding Yotta’s Greater Noida Data Center Park. Yotta also plans to invest over Rs 9800 crore in Edge data centers,” said Gupta.

The company plans to build Edge data centers in cities like Bhubaneshwar, Chandigarh, Coimbatore, Guwahati, Indore, Jaipur, Kochi, Lucknow, Mangalore, Nagpur, Surat, Varanasi, Vishakapatnam and more.

Other firms are also working to expand their presence and capacities across sector. One of them is Web Werks which has its footprint in Bengaluru, Hyderabad, Chennai, Navi Mumbai, and Noida. 

Talking about the future of data center, Nikhil Rathi, CEO and Founder of Web Werks, said, “By 2025, data center investments are expected to exceed $20 billion. Almost 75% of the DC market is to be possessed by Mumbai, Chennai, and Bengaluru with the remaining spread over Delhi NCR, Hyderabad, Kolkata, Noida and Pune. 5G, IoT is expected to enable the movement of computing towards the network edge for better latencies, which will further drive the emergence of new small-scale edge data centers around the world. With the growing demand, what runs parallelly is the increasing job opportunities in the data center industry. It is expected to be 2% through 2023 and 3% by 2025. Data centers are also expected to invest in the necessary changes to prepare for 5G adoption.”

On the other hand, giants like Google and Microsoft are also working to expand their capacities and reduce their carbon footprints. Google and Microsoft have both announced new agreements to lower their IT operations’ carbon footprint by using renewable energy sources in their data centers. According to a report, Google has signed a power purchase agreement (PPA) with Engie, a French utility company, for 100 MW of energy generated by the Moray West offshore wind farm in Scotland to power its UK operations. Meanwhile, Microsoft announced PPAs supplying more than 900 MW of renewable energy in Ireland for its data centers.



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