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India Data Center Market Size, Share, & Trends Analysis Report by IT Infrastructure (Servers, Storage, and Network), Electrical Infrastructure (Uninterruptible Power Supply (UPS) Systems, Generators, Rack Power Distribution Units (PDU), Transfer Switches & Switchgears, and Others), Mechanical Infrastructure (Cooling Systems, Racks, and Other Mechanical Infrastructure), Cooling Systems (CRAC & CRAH Units, Chiller Units, Cooling Towers, Dry Coolers & Condensers, and Other Cooling Units), General Construction (Building Development, Installation and Commissioning Services, Building Designs, Physical Security, and Data Center Infrastructure Management (DCIM) & Building Management Systems (BMS)), Tier Standards (Tier I and II, Tier III, and Tier IV), and Geography (Maharashtra, Karnataka, Telangana & Andhra Pradesh, and Other States), Global Analysis Report, Global Outlook, Market Trends, Competitive Landscape, Share, Growth Potential & Forecast, 2020-2025
|Market Size (REVENUE)||USD 4 BILLION (2025)|
|Market Size (AREA)||2.5 MILLION SQ.FEET (2025)|
|Market Segments||IT Infrastructure (Servers, Storage, and Network), Electrical Infrastructure (Uninterruptible Power Supply (UPS) Systems, Generators, Rack Power Distribution Units (PDU), Transfer Switches & Switchgears, and Others), Mechanical Infrastructure (Cooling Systems, Racks, and Other Mechanical Infrastructure), Cooling Systems (CRAC & CRAH Units, Chiller Units, Cooling Towers, Dry Coolers & Condensers, and Other Cooling Units), General Construction (Building Development, Installation and Commissioning Services, Building Designs, Physical Security, and Data Center Infrastructure Management (DCIM) & Building Management Systems (BMS)), Tier Standards (Tier I and II, Tier III, and Tier IV)|
|REGIONS COVERED||Maharashtra, Karnataka, Telangana & Andhra Pradesh, and Other States|
The India data center market size to cross USD 4 billion by 2025, growing at a CAGR of 4% during the forecast period. As the number of standalone colocation services in India is low than managed colocation or managed hosting services, several small enterprises in India prefer managed hosting or cloud services rather than colocation. Sectors such as BFSI, logistics, transportation, e-commerce, and government agencies are witnessing high demand for colocation services. Global enterprises involved in establishing a physical presence in the Indian market are colocating facilities in the country. Hence, the increased investment from global colocation service providers is likely to influence the India data center market during the forecast period.
The favorable government support in the form of tax incentives is another key factor accelerating market growth in India. Telangana, Gujarat, Andhra Pradesh, and Maharashtra governments are providing considerable incentives for data center development. For instance, the Maharashtra government announced the GST refund for a maximum period of 10 years for the companies that participate in the development of integrated facilities. Similarly, the Andhra Pradesh government announced to provide 50% reimbursement of SGST on the purchase of raw materials and equipment for three years from the date of approval of the project. Therefore, increasing government support is likely to influence the data center development in India.
This research report includes detailed segmentation by
The adoption of server infrastructure is dominated by rack servers, which account for over 70% of the market share. However, tower servers are experiencing a negative growth rate. The adoption of converged and hyper-converged infrastructure solutions will have a high impact on the server market growth during the forecast period.
The increased adoption of all-flash storage arrays and hybrid storage arrays is boosting the demand for storage systems. High-performance operations aid the growth of flash storage systems in data centers that require strong I/O capabilities. The data center market in India is witnessing significant growth in the data, which requires flash arrays as they offer high storage performance, especially in the virtualized data center environment.
The growth in data traffic has necessitated the application of 10 GbE switch configuration at the top of the rack, with switches of high capacity being deployed in aggregation and core layers. Many on-premise facilities in India use 1 GbE switches. However, these switches are likely to be replaced by 10 GbE or 25GbE switches during the forecast period. The growing flash deployment in the data center market in India will prompt enterprises to shift to NVMe-oF switches.
The unstable grid connectivity in India makes UPS systems a critical component for uninterrupted service operations. CtrlS in its Hyderabad facility adopts power systems with up to 2(N+1) redundant configuration. SIFY Technologies in its Kolkata facility has adopted UPS systems with 500kW in N+N redundant configuration. Mumbai has witnessed the highest power capacity addition with investments from Yotta (Hiranandani Group), SIFY Technologies, CtrlS, and Bridge Data Centres. The data center market by power capacity is expected to grow during the forecast period as the solar energy potential in Karnataka is estimated to exceed 24.7 GW. This will be a major benefit for service operators to power their facilities through solar energy.
Generators are irreplaceable in the India data center market as power fluctuation is common in the country. The use of generators is essential for those regions where power outages are frequent and are highly susceptible to natural disasters. Generators become a critical component to support the entire load during power outages for up to 72 hours. Generators are mostly designed with N+N or 2N redundancy in Tier III and Tier IV data centers established across the country. In India, there are on-premise data center deployments typically of less than 500 kW that does not require a separate generator.
The use of water-based cooling is likely to increase in the India data center market during the forecast period. However, the scarcity of water in a few cities will pose a challenge for facility operators in supporting operations. Most facilities are powered with air-based cooling systems. For instance, Netmagic recently established facilities in Mumbai and Bengaluru are equipped with air-based cooling systems of N+2 redundancy. The redundancy of cooling systems is N+1 or N+N configuration among tier III facilities. Tier IV facilities adopt the 2N+1 redundant configuration for cooling systems. The redundancy of CRAC and CRAH units is higher than other systems. The use of dual water feeds with on-site water treatment plants is also gaining popularity in the Indian market.
Innovations have increased the growth and adoption of performance-optimized data centers (PODs). These facilities typically comprise 1–20 rack units with pre-installed power and cooling infrastructure. Generally, 42U racks can equip 42 1U servers or 14 3U blade servers. Several facilities are still utilizing only 50% of the rack space (21U). For example, if a data center server equipped with 42U rack consumes 200 Watts of power, the total power consumption would be 8.4 kW per rack. However, the increased use of converged infrastructure will affect the rack market.
The India data center market has a strong presence of construction contractors and sub-contractors. Sterling & Wilson, VatsuNidhi Architects, and L&T Construction are among the leading local contractors in the market. They also carry out installation and commissioning services. Most government facility development projects are carried out through tenders. The expertise of the construction contractor plays a vital role in attaining these projects. Besides, partnerships with colocation providers will yield significant revenue opportunities for contractors.
Major commissioning processes are usually related to power connectivity with grid, network cabling, and heat transfer mechanisms. The labor cost for installation services depends on the size and capacity of the facility and expertise. The labor cost in India is low than in the US and Western Europe. The growth of greenfield data center facilities is likely to generate high revenue opportunities for installation and commissioning service providers.
With the increasing focus on building highly efficient and reliable data centers, the investment in Tier IV facilities is expected to grow in India. Most new facilities are designed as Tier III standards with minimum N+1 redundancy and can be reconfigured with up to 2N redundancy as the demand arises. The data center market in India witnessed the development of around 20 Tier III category projects. This trend is likely to continue during the forecast period, with many large operators expected to move to tier IV category due to the growth in rack power density and critical applications.
Investments from CtrlS, GPX Global Systems, and Pi DATACENTERS will continue to grow the revenue for the Tier IV category in the market. Building a Tier IV facility in India will cost around $5-6 million. The labor cost is low than in developed countries, thereby reducing the construction cost to a considerable extent.
Mumbai, Bengaluru, Chennai, Delhi, and Hyderabad will be the major cities driving data center growth throughout the forecast period. AWS, Microsoft, Google, Alibaba, IBM, and Tencent have established their physical presence in the cities mentioned above. The global service providers such as Equinix and Digital Realty are expected to invest in the market during the forecast period. Recently, Digital Realty partnered with Adani Group to develop data centers in India. Moreover, government initiatives to migrate all their operations to the cloud platform to push digital economy will aid in the development of multiple facilities in states such as Kerala, Assam, West Bengal, Andhra Pradesh, Gujarat, Madhya Pradesh, Odisha, Bihar, Jharkhand, Uttar Pradesh, Haryana, Punjab, Himachal Pradesh, and Jammu & Kashmir.
The India data center market is witnessing steady growth in terms of IT infrastructure procurement, greenfield, brownfield, and modular facility development. It is likely to adopt efficient, scalable, flexible, and reliable infrastructure solutions. The market has evolved over the years with multiple innovations focused on enabling flexible and scalable enterprise operations in the era of cloud, big data, Internet of Things, and Artificial Intelligence in industries.
In terms of support infrastructure perspective, the market is witnessing the high adoption of solutions, which help to reduce power and water consumption and decrease CO2 emissions. Moreover, the market has a strong presence of vendors in the three categories: IT infrastructure, support infrastructure, and data center investors. Tata Consultancy Services (TCS), Wipro, Cognizant, Infosys are the major contributors to the market offering managed data center services. Managed services majorly dominate the colocation market in the country.
Market Segmentation by IT Infrastructure
By Electrical Infrastructure
By Mechanical Infrastructure
By General Infrastructure
By Tier Standards
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