India Takes the Lead in the Asia-Pacific Data Centre Race
India has emerged as the most attractive market for data centre development in the Asia-Pacific region outside China, according to a new assessment by BloombergNEF. The report places India ahead of other major regional markets such as Indonesia, Japan and Singapore, highlighting the country’s growing importance in the digital infrastructure landscape. For businesses, investors and technology companies, the finding reinforces India’s position as a key destination for the next wave of data centre expansion.
BloombergNEF gave India a score of 73 in its latest market assessment, compared with 68 for Indonesia, 63 for Japan and 62 for Singapore. The study, updated through August 2026, evaluated 10 markets using factors such as energy availability, land access, tax conditions, fibre connectivity and existing operational capacity. India’s strong showing was driven particularly by its access to energy and its improving fibre network, both of which are essential for supporting large-scale digital operations.
Rapid Capacity Growth Signals Long-Term Momentum
India’s live IT capacity has expanded sharply over the past six years, rising fourfold to reach 1.7 gigawatts. That growth is not expected to slow soon. BloombergNEF said 1.3 gigawatts of data centre capacity is already under construction, while another 3.2 gigawatts of projects have secured land, power connections and the permits required to move into the building phase. This pipeline suggests that India’s data centre market is moving from early growth into a much larger expansion cycle.
The scale of this growth matters because data centres are becoming the backbone of the digital economy. As demand rises for cloud services, artificial intelligence processing, online commerce and digital storage, countries with reliable power and connectivity are increasingly attractive to global operators. India appears to be benefiting from this shift, with the report indicating that infrastructure readiness is now translating into significant market confidence.
Maharashtra Remains the Core of India’s Data Centre Ecosystem
Within India, Maharashtra continues to dominate the data centre market. The state accounts for 65% of the country’s live IT capacity and also leads in the number of approved projects waiting to begin construction. BloombergNEF attributed Maharashtra’s advantage to a combination of strong enterprise demand, established cloud infrastructure, subsea cable connectivity and a mature ecosystem of developers. These advantages have helped the state become the central hub of India’s data centre activity.
At the same time, the next phase of growth is expected to spread more widely across the country. Andhra Pradesh, Gujarat, Karnataka, Tamil Nadu, Telangana and Uttar Pradesh are all expected to play a larger role as companies announce fresh projects and investments. This geographic diversification could help create a broader national network of digital infrastructure while also reducing overdependence on a single market.
Big Investments and AI Demand Are Reshaping the Market
One of the most striking findings in the report is the scale of planned investment. Reliance Industries and Adani Group together have committed 210 billion US dollars to data centre development in India, accounting for 45% of the total announced investment tracked by BloombergNEF. This underlines how central the sector has become to India’s long-term technology and infrastructure strategy.
Much of this capital is being directed toward hyperscale AI campuses, with around 95% of announced investment targeting these very large facilities. That reflects the rapid rise of artificial intelligence workloads, which require vast computing power, storage and energy resources. As AI adoption grows, demand for larger and more advanced data centres is likely to intensify, placing India in a strong position if it can continue to scale efficiently.
Power Demand Will Be the Next Major Test
While the growth outlook is strong, the report also points to a major challenge: electricity consumption. India’s annual data centre power demand is projected to increase more than eightfold, a surge that will test the country’s ability to supply reliable and sustainable energy at scale. Meeting that demand will be crucial not only for developers and investors, but also for policymakers shaping the country’s broader digital and energy future.
Overall, the report presents a clear picture of India as a rising Asia-Pacific leader in data centres. With growing live capacity, a deep project pipeline, strong investor backing and expanding AI infrastructure ambitions, the country is building the foundations of a major regional digital hub. The next chapter of growth, however, will depend on how effectively India balances expansion with energy readiness and long-term infrastructure planning.
Key Terms
- Data centre: A facility that houses servers and networking systems used to store, manage and process digital information.
- IT capacity: The amount of computing infrastructure a data centre can operate, often used as a measure of scale.
- Gigawatt (GW): A large unit of power used to measure electricity capacity or energy demand.
- BloombergNEF: A research firm that tracks energy, technology and market trends.
- Fibre connectivity: High-speed internet connections delivered through fibre-optic cables.
- Live capacity: Data centre capacity that has already been built and is currently operational.
- Project pipeline: The total set of projects that are planned, approved or under development.
- Hyperscale AI campus: A very large data centre complex designed to support cloud computing and artificial intelligence workloads at massive scale.
- Subsea cable connectivity: International internet links provided by cables laid under the sea.
- Cloud infrastructure: The hardware and systems that support online computing, storage and digital services.
