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India is poised to require an additional 45-50 million square feet of real estate and 40-45 terawatt-hours (TWH) of incremental power for data centres by 2030, driven by the rising demand for artificial intelligence (AI), according to Deloitte. The company's report highlights India's cost advantages, renewable energy focus, and strategic location, but stresses that the country's growth as a global AI hub is dependent on overcoming significant gaps in infrastructure, talent, and policy. The report calls for targeted interventions and policy support to foster AI-driven data centre development, alongside investments in power and connectivity.
According to Deloitte's research, India may require an extra 45-50 million square feet of real estate and 40-45 terawatt-hours (TWH) of additional power by 2030 to meet the country's growing demand for artificial intelligence (AI) applications. This projection underscores the need for significant expansion in the country's data centre infrastructure to support AI's rapid growth. In a report titled "Attracting AI Data Centre Infrastructure Investment in India", Deloitte recognised India's advantages in terms of cost-efficiency, focus on renewable energy, and its strategic geographical position. However, the report stressed that India's ambitions to become a global AI hub will depend on addressing critical infrastructure, talent shortages, and policy gaps. Advertisement
The report outlined six key pillars required for building a world-class AI ecosystem: real estate, power and utilities, connectivity, compute infrastructure, talent, and a robust policy framework. It highlighted the importance of infrastructure upgrades to meet AI's needs and suggested interventions such as the creation of a dedicated category for data centres in the National Building Code, as well as recognising them under the Essential Services Maintenance Act to incentivise investment in specialised facilities.
To expedite the growth of data centres, the report recommended the establishment of data centre facilitation units that would simplify approval processes. Deloitte also advocated for the development of streamlined data localisation norms and the creation of dedicated data centre zones. It was noted that these measures would be pivotal in bolstering India's AI infrastructure.
Additionally, Deloitte called for a revision of data access provisions under the Bharatiya Nagarik Suraksha Sanhita (BNSS) of 2023 to align with the operational realities of data centres. The firm also recommended excluding data centres from surveillance provisions in the Telecommunication Act of 2023, to foster a more conducive environment for growth. Moreover, the implementation of safe harbour rules for data hosting providers and the establishment of data embassies were suggested as ways to catalyse further investment in the sector.
However, Deloitte also cautioned that the rapid expansion of data centres would place increased pressure on India's power grid. This would necessitate urgent investments to expand generation capacity, modernise infrastructure, and integrate renewable energy sources more effectively. Despite significant improvements, connectivity challenges, such as limited fibre optic reach in rural regions, unreliable high-speed internet, and high latency, continue to hinder the country's ability to fully realise its potential in data centre development.
Neha Aggarwal, Partner at Deloitte India, pointed out that India must prioritise the development of high-performance compute infrastructure, scalable power and cooling systems, and efficient networking infrastructure, alongside revising the policy framework. Such efforts could position India as a major hub for AI-driven data centre development in the coming years.
Effective policy support, infrastructure upgrades, and strategic interventions will be vital to meeting these needs. If these steps are implemented, India could become a key player in the global AI ecosystem, driving investment and technological progress in the coming decade.
Source - PTI
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