India’s AI Infrastructure Sees Rapid Growth
India is rapidly positioning itself as a global hub for artificial intelligence (AI) and data center infrastructure. Backed by government initiatives, foreign direct investments, and soaring digital demand, the country had already attracted over US$60 billion in data center investments by 2024, with projections indicating this figure could surpass US$100 billion by 2027. The AI sector alone is expected to contribute US$400 billion to India’s GDP by 2030, growing at a 28% CAGR.
According to the UNCTAD Technology and Innovation Report 2025, India now ranks 10th globally in AI investment with US$1.4 billion, supported by a talent pool of 13 million AI professionals. Major global players like AWS, Microsoft, and NTT have expanded operations, drawn by central policies such as 100% FDI under the automatic route and tax incentives offered by states like Maharashtra, Tamil Nadu, and Telangana.
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Investments, Capacity, and Sustainability Push
India’s data centre market, valued at US$10 billion in FY 2023–24, has seen 139% growth in capacity since 2019, from 590 MW to 1.4 GW. Regions like Mumbai and Chennai contribute to 70% of installed capacity, with Mumbai alone accounting for nearly 50% of total IT power. Hyderabad leads land acquisition for hyperscale centers with a 69% share of 440 acres acquired over five years.
On March 7, 2024, the government approved INR 107.3 billion (US$1.24 billion) for AI-specific data center infrastructure. These next-gen centers include liquid cooling, floor loads up to 2,500 kg/m², and energy-efficient designs. Efforts also align with India’s net-zero targets, with private firms like AdaniConneX investing in 100% green-powered data centers.
National and Global Impact
States such as Andhra Pradesh and Madhya Pradesh are advancing AI-focused facilities, while cities like Pune demonstrate municipal AI adoption with traffic optimization systems. At the global level, India’s AI model, shaped by inclusive governance and ethics frameworks, offers a scalable example for 118 Global South countries currently excluded from major regulatory discussions.
With strong momentum across policy, investment, and talent, India is well-poised to lead the next wave of AI infrastructure globally.
