India’s data centre market is witnessing strong investor confidence, with fresh capital expected to flow in at a significant scale this year. The sector continues to evolve rapidly, driven by rising demand for digital infrastructure.
According to a recent industry report, the data centre segment in India could attract investment commitments of over $54 billion in 2026. The report also states that total data centre stock across major cities is likely to grow by 30% year-on-year, with an estimated 500 MW of new supply expected this year.
In 2025, India’s total data centre capacity reached 1,700 MW, supported by a record addition of 440 MW. Investment commitments during the same year stood at $56.4 billion, taking the cumulative total to $126 billion. The report further noted that overall commitments could rise by around 45%, potentially crossing $180 billion.
Industry leaders highlighted that the sector has moved beyond early-stage growth. “The sector’s resilience and attractive return potential are establishing it as a primary focus for investors, with foreign capital playing a dominant role. This interest is supported by a robust regulatory framework that continues to enhance transparency and streamline credit access.”
The growth momentum is expected to position India as one of the fastest-growing data centre markets in the Asia-Pacific region. Key states such as Telangana, Maharashtra, Andhra Pradesh, Tamil Nadu, and Uttar Pradesh are likely to attract major investments.
At the same time, expansion is moving beyond metro cities. With increasing demand for low latency, 5G growth, and data localisation, operators are investing in tier-II cities like Ahmedabad, Visakhapatnam, Patna, and Bhopal.
Mumbai continues to dominate the sector, accounting for over 50% of India’s operational data centre capacity as of 2025-end. Along with Chennai, Delhi-NCR, and Bengaluru, these hubs contribute nearly 90% of the country’s tier-I capacity.
The report also pointed to rising pressure on power infrastructure due to rapid growth in AI and cloud services. “Rapidly scaling AI and cloud infrastructure is placing unprecedented strain on power grids in high-density data centre hubs.” As a result, renewable energy is becoming a key part of future data centre strategies.
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