India’s data center industry has over USD 6.5 billion in investments committed through private equity, joint ventures, and acquisitions between 2014 and 2024, according to a new report titled India Data Centre Market: Growth, Trends & Outlook by Anarock Capital.The industry has witnessed exponential growth between 2019-24, recording a 139 percent increase in capacity scaling from 590 MW in 2019 to 1.4 GW in 2024.
“This surge is underpinned by rising internet penetration, which has risen from 33.4 percent in 2019 to 55.2 percent in 2024), a near-doubling in data consumption per user from 11.5 GB to 21.1 GB/month, and an explosion in average traffic per smartphone, which grew from 13 GB to 32 GB. India now leads globally in average mobile data traffic per smartphone, and just this fact alone has had a palpable impact on the demand for high-grade data centers in the country. India’s booming digital engagement is a direct indicator of future DC demand,” said Devi Shankar, Executive Director – Industrial, Logistics & Data Centres, at Anarock Capital.
Mumbai and Chennai dominate the data center market, accounting for 70 percent of India’s total IT power capacity, with Mumbai alone contributing nearly half at 49 percent. These cities also witnessed record-breaking supply growth from 2022 to 2024 – 92 percent in Mumbai and 340 percent in Chennai. Other key markets include Noida (9 percent) followed by Bangalore (8 percent). Hyderabad accounted for 4 percent while Pune 5 percent of the overall market. Together, these regions have contributed to an overall occupancy level of 76 percent, underscoring strong market absorption and operational efficiency.
Some of the key trends driving the data center market include AI, expansion to tier-2 cities, and sustainability. AI is set to drive the next wave of DC requirements. To accommodate AI workloads, future-ready data centers will require: liquid cooling technologies, rack densities of more than 30-40 kW per rack, and floor loads up to 2,500 kg/sq.m.
There will be a rise in tier-2 and -3 cities. “To bring computing closer to users, edge data centers – small-scale, decentralized data storage and processing facilities located nearer to end-users and devices in tier-2 and tier-3 markets – are emerging,” said Ankita Sahu, Senior Manager – Industrial, Logistics & Data Centres, Anarock Capital. “These include, among others, cities like Jaipur, Ahmedabad, Kochi, Vizag, Lucknow, Patna, and Bhubaneshwar. Edge data centers will play a vital role in supporting latency-sensitive applications and Gen AI-based services.
Finally, with environmental concerns gaining traction, there is a growing emphasis on energy-efficient design, renewable energy sourcing, and sustainable cooling methods. Green data centers are set to be a cornerstone of industry development going forward. As part of its growth strategy in India, NTT DATA has recently opened its biggest data center campus in the country. When fully operational, the facility can hold over 500 MW of power.
As the third-largest data center provider globally, and the largest in India, NTT DATA is scaling its global capacity from over 1,500 MW to exceed 2,000 MW. With significant growth in India, where it holds the leading market share, it aims to add 400 MW more in the coming years. NTT DATA claims to be the only data center service provider with over 200 MW of AI load already deployed worldwide. NTT DATA also announced that it is upgrading and expanding its Innovation Centre in Bengaluru, India. The center will focus on AI, digital twin, and quantum computing projects. With this, the company has 11 global innovation centers across 11 countries that will boost the hiring of specialized talent to manage projects for global companies, driving AI-led technology solutions, particularly with agentic AI.
