Sustainability Meets Scalability: Devi Shankar on India’s Data Centre Revolution

India’s data centre industry is on the cusp of an extraordinary transformation, driven by advancements in technology, increasing digitalisation, and a surge in cloud computing. Senior Journalist Neeraj Tiwari from Marksmen Daily spoke with Devi Shankar, Executive Director – Industrial, Logistics & Data Centres at ANAROCK Capital, to explore the evolving landscape of data centres and the trends shaping the sector in 2025 and beyond.

What is driving the exponential growth of India’s data centre market?

India’s data centre market is growing robustly, with its total capacity projected to reach 2 GW by 2026. This growth is propelled by multiple factors, including cloud computing, 5G rollouts, and the digitalisation of sectors like BFSI (Banking, Financial Services, and Insurance). Additionally, AI workloads are ramping up demand significantly. By 2032, the market value is expected to hit $11.6 billion. Institutional investors have recognised this potential, committing substantial capital to the sector.

Large data centre campuses are gaining momentum. Could you elaborate on this trend?

Absolutely. Operators are increasingly investing in large-scale campuses with capacities exceeding 100 MW. Navi Mumbai has emerged as a hotspot, alongside Chennai and Hyderabad. For instance, Hyderabad is witnessing significant hyperscaler activity, with some projects spanning 100+ acres. These large campuses are essential to meet the growing demand for AI-driven and cloud-computing needs.

How is AI reshaping the infrastructure requirements of data centres?

AI is a game changer. According to NASSCOM, India’s AI market is expected to grow at a CAGR of over 20% from 2023 to 2028. This translates to denser and more power-intensive data centres. Rack densities are projected to rise from the current 8-10 KW/rack to nearly 30 KW/rack soon. Infrastructure upgrades like advanced cooling solutions, such as liquid immersion cooling, will play a pivotal role in managing this demand sustainably.

Sustainability is a major focus area for industries today. How is the data centre sector responding?

The sector is actively integrating Environmental, Social, and Governance (ESG) considerations. Many operators are transitioning to renewable energy sources like wind and solar through strategic power purchase agreements. Some are even investing in green power projects to achieve 100% sustainable facilities. Additionally, the government is exploring nuclear energy to power data centres, a vision that could begin materialising by 2025.

What roles do edge data centres play in the future of this industry?

Edge data centres are critical for enhancing connectivity and reducing latency, particularly in tier II and III cities. These facilities will support applications like IoT devices, OTT platforms, and Smart Cities. Cities like Patna, Jaipur, Lucknow, and Bhubaneshwar are already attracting commitments from operators to establish such facilities. Edge centres will bridge the gap between data generation and processing, ensuring a seamless user experience.