India’s Data Centre Industry Capacity to Double by 2023 to 1,008 MW: Report

According to property consultancy JLL, the capacity of the data centre sector is anticipated to double by 2023 to over 1,000 MW to satisfy growing demand amid rapid development in digitalisation.

The capacity of the sector is anticipated to double from 499 MW in January-June 2021 to 1,008 MW by 2023, according to the report. IT design power load is expressed in megawatts (MW).

JLL India stated in a statement that the capacity increase is “led by robust digitisation, growing cloud use, and ambitious development plans of data centre operators.”

On Tuesday, JLL issued its ‘H1 2021 India Data Centre Market Update.’

According to the expert, since digitalization has driven businesses to build up their IT infrastructure, there has been a high demand for co-location/cloud facilities in India, which provide scalability, security, and connectivity at cheaper rates.

During the previous six months, investors and global data center operators have expanded their commitment to the India industry by establishing joint ventures to fulfill projected demand, according to the report.

“The demand momentum that began to build up in 2020 is continuing unabated. During H1 2021, the Indian data centre sector saw 46.4 MW of absorption, which is comparable to 90% of supply increase during the period (H1 2021), showing strong absorption growth” said JLL’s Mr. Rachit Mohan, Head of Data Centre Advisory-India and Co-Head of Office Leasing Advisory in Mumbai.

According to him, demand has been quickly increasing as a result of increased digital usage resulting from a scattered workforce, rising data security concerns, and business interruptions.

“Banking and financial services are embracing hybrid alternatives to meet digital growth, while home-grown video and gaming platforms are fueling data centre demand, and telecom players are planning the deployment of 5G, which is projected to generate exponential increase in data consumption,” added Mr. Mohan.

Global investors and data centre players have upped their commitment in the previous six months, according to Mr. Samantak Das, Chief Economist and Head of Research & REIS (India), JLL.

“Investment commitments of US$ 3 billion underline the development potential, noting that the data centre industry is anticipated to double its capacity and surpass 1 GW by 2023,” he added.

Between now and 2023, Mumbai, which now accounts for 45% of total capacity, is anticipated to add 267 MW, Mr. Das said, adding that other governments have also provided incentives for the data centre business.

According to the consultant, data centre operators are pursuing big land purchase plans in order to meet hyperscalers’ long-term needs (large cloud players and occupiers with massive computing requirements).

“These operators would provide occupiers the flexibility they need in terms of availability zones, fibre routes, and power requirements for large-scale expansions in a shorter amount of time. To address the rising demand, players are forming strategic partnerships by investing in new undersea cables,” According to JLL.