India Data Center Market Size

India Data Center Market Analysis

The India Data Center Market size is expected to grow from USD 6.12 billion in 2023 to USD 10.89 billion by 2028, at a CAGR of 12.22% during the forecast period (2023-2028).

The rapid adoption of cloud-based business operations has encouraged businesses to acquire data management capacities to handle huge volumes of data that are being generated. Increased proliferation of online shopping due to the availability of user-friendly interfaces, high-speed internet, and smart devices such as smartphones, tablets, laptops, etc., is expected to drive the market in the future.

• India is among the APAC region's major players in the data center sector. Data centers are critical for national security, internet infrastructure, and economic output. In India, data center infrastructure is growing exponentially, with a growing preference for the Cloud and increased data consumption and generation by over half a billion digital users.
• For companies that undertake the cloud migration process, the Cloud can have a huge impact. This includes reducing the total cost of ownership (TCO), quicker delivery, and better prospects for innovation. Agility and flexibility, two essential qualities to satisfy changing consumer and industry demands, come with access to the Cloud. The migration of businesses to the Cloud has increased recently as they shift into more flexible digital workplaces to deal with the increase in online demand and remote working. Although the Cloud is the foundation of digital transformation, cloud services are built on data centers. Due to this, the cloud migration of businesses is driving the growth of the data centers market in India.
• India is becoming the global destination for setting up data centers. But it could also reinforce its position as a global hub for green data centers. Demand for new data centers is enormous in India, driven by the hyperscale facilities key internet players, such as Amazon Web Services (AWS), Microsoft, Google Cloud, and Alibaba Cloud, demand to power their clouds.
• Datacenter establishment in India is cost-intensive, a barrier to entering the industry for many data center companies. Prevalent norms for commercial buildings applied to data centers lead to wastage of space and increased cost. Besides, factors such as high real estate costs, expenses on improving wide area network connectivity, and increased equipment costs have also augmented the heavy CapEx in the sector.
• The COVID-19 pandemic led to a new wave of digital transformation in various sectors across the country. Businesses rapidly turn to third-party colocation facilities for data center operations, further complemented by an increased shift toward a hybrid IT approach that leverages the combined capabilities of hosted data centers and multi-cloud setups.