India’s data centre industry has come a long way, becoming an integral component of the nation’s digital infrastructure. In 2016, the total live capacity was 296 MW, and grew to 1.6 GW by 2025 as demand for cloud computing, digital services and AI increases. Existing data centre clusters like Mumbai, Chennai, Hyderabad, Bengaluru and Kolkata are also contributing to the growth of the data centre market in India as the market grows in size.
India’s Data centre capacity has grown more than fivefold
In the last 10 years, the growth of Data Centres in India has become more evident and clear. Mumbai recorded the highest absolute growth with the other cities of Chennai, Hyderabad, Bengaluru and Pune also growing their data centre footprint noticeably. Overall, India’s live capacity recorded a CAGR of around 30% over the past five years.
Expansion is also taking place beyond the current capacity. By the end of 2025, 322 MW was being built and another 8.3 GW was expected to be in the long-term pipeline, as the demand for digital infrastructure continues.
Mumbai
Mumbai is still the number one data centre market in India and will continue to make up approximately 47% of the live capacity in India by the end of 2025. It has grown its live capacity from 96.8 MW in 2016 to 766.6 MW in 2025, bolstered by its position as the financial capital, excellent fibre connectivity and international subsea cable landings.
The city is also in the process of making further additions, with 1,543.3 MW committed capacity and 2,209 MW at the early-stage pipeline stage. Vacancy is at in approximately 6.7% in 2025, indicating that new supply is being absorbed almost as fast as it is built and that capacity remains strained due to high demand
Chennai and Hyderabad Strengthen Their Positions
Although Mumbai remains the top city, Chennai and Hyderabad are new strong cities in India’s data centre market. In 2025, the live capacity in Chennai is calculated as being 191.5 MW, compared to 73.2 MW at the end of 2022, which accounts for about 12% of the Indian capacity. The city also has an early-stage pipeline of 1,040 MW, with data centre operators still interested.
Hyderabad has seen even more dramatic growth over the last few years: its live capacity has increased from 60.9 MW in 2022 to 151.4 MW in 2025. It is growing fast as a luxury realty market of South India. Telangana is increasingly developing around the GPU, large-scale training computer, and liquid cooling, driving the shift towards hyperscale and AI infrastructure in the market. It has a pipeline of committed and early-stage projects of approximately 1.9 GW, which makes it one of the largest future data centre markets in the country.
While industrial and land acquisitions for multi-acre hyperscale parks remain intensely active, Chennai’s growth pace is seeing mild deceleration relative to Hyderabad.
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Bengaluru, Pune and NCR Develop as Specialised Hubs
In addition to the big hyperscale markets, Pune and Bengaluru have become more niche in India’s data centre market. Bengaluru; live capacity was 169.5 MW in 2025, compared to 31.4 MW in 2026 and a demand for high density colocation facilities at R&D centres and Global Capability Centres (GCCs). Bengaluru’s housing market recorded a 79% price surge over a five-year period.
Pune with 145.3 MW of live capacity is becoming an attractive option for enterprises who are priced out of Mumbai. In Delhi-NCR, live capacity recorded 174.5 MW in 2025, which has increased by 55% from 2022, and the demand by BFSI and government sectors is supporting this increase. So far, over 50% of the region’s colocation lease deals have been with public cloud providers.
Kolkata emerges as Eastern India’s Data centre hub
Kolkata is also emerging as a regional market for data centres, with growing live capacity from 5 MW in 2016 to 23.1 MW by the end of 2025. The city is a gateway to Eastern and Northeastern India and the new cable landing station at Digha is expected to further boost its connectivity and data centre capabilities.
There is potential for further growth in this market, with 13 MW in construction and another 133.4 MW committed and in early stages of development. However the market is still highly concentrated, with the top four operators representing almost 90% of live IT capacity.
AI Emerges as the Biggest Driver of Data Centre Demand
AI is transforming the demand of data centres in India. AI-related leasing was a significant contributor to total leasing capacity in 2025, representing 78% of the total total colocation leasing in 2025, which was a huge jump from 23% in 2024.
Government initiatives are also contributing to the domestic AI infrastructure’s growth. 38,000 GPUs have been installed for startups and researchers; and another 20,000 are on the way, thus driving new demand for AI computers in India.
India’s Data Centre Market Is Entering Its Next Phase
From a niche infrastructure segment, the data centre industry in India has emerged as a key enabler of the nation’s digital economy. The market has 1.6 GW of live capacity, 8.3 GW in the long-term pipeline and 447 MW of colocation agreements signed in 2025, which will further fuel its growth. The next phase will rely on India’s ability to build out the infrastructure needed from planned capacity to serve the power, connectivity and cooling demands of AI-driven workloads.
In India, the total capacity of all the data centres has increased from 296 MW in 2016 to 1.6 GW for 2025. Other cities and emerging markets continue to grow and provide for the increasing demand for AI and digital infrastructure, with Mumbai still leading the way in terms of size.