India’s unique position in the global data corridor- connecting east and west

In recent years, India’s datacenter market has experienced phenomenal growth, positioning it as a favourable location compared to other East Asian countries. With its vast geographic location, subsea cable infrastructure, and emerging digital ecosystem, India is becoming an international digital hub that caters to the connectivity needs of companies in both Eastern and Western markets.

According to a recent report, India is emerging as a key player in the APAC region, with the highest datacenter capacity of around 850 MW. This is outpacing countries like Singapore, Australia, Hong Kong, Japan etc.

Key Locational and Ecosystem Advantages of India

1.Cost Efficiency

India offers a more economical environment for datacenters compared to Singapore or other developed economies. Operational costs, such as real estate and power, are significantly lower in India. Smaller countries like Singapore and Japan, face constraints such as limited space, high energy prices and geographical instability. Western developed countries like Australia, Europe etc. face issues related to shortage of skilled employees, sustainability concerns and higher costs. India’s vast land availability, especially in regions like Chennai, Hyderabad, and Mumbai, makes it easier to expand datacenter facilities at a lower cost.

2. Growing Data Center Capacity

India’s datacenter market is growing rapidly. It is expected to reach 5 billion by 2025 and is expected to double its capacity by 2026 from current outsources capacity of 1GW, driven by local and global investments This is expected to be only second to China. This scaling potential makes India a long-term solution for companies looking to establish a reliable and secure digital infrastructure.

3. Favourable Data Localization Regulations

India’s data localization laws, which require sensitive data to be stored within the country, have attracted significant investments. As India moves towards becoming a $1 trillion digital economy by 2030, companies are increasingly choosing India to ensure compliance with these regulations while benefiting from local cost efficiencies and a young, digitally savvy market. The policy prudence and open market sentiments of the country work well with global conglomerates.

4. Emphasis of Rated 4 datacenters

Apart from the top metro cities, India’s Tier 2 cities too are well equipped to provide safe and secure datacenters. There is a greater emphasis in the country to develop Rated 4 datacenter or Tier 4 datacenters (top ranked datacenters) to ensure maximum security.

5. Strong Talent Pool

Shortage of strong talent pool, i.e engineering skill sets is a major concern in datacenter markets like Western Europe and North America. India has both the talent pool as well as a young population that will propel the use of the digital economy. The fact that the datacenters in India are proactively working towards sustainable growth is a huge advantage for businesses.

6. Geographical Location

India’s location makes it a great link between the East and the West for data flow. With major subsea cable connections, India is able to facilitate fast and reliable connections between regions like Europe, Southeast Asia, and even the United States. Its proximity to fast-growing markets such as China and Southeast Asia further strengthens its strategic importance. In the past, India was a strategic trade location and an important trade link between East and the West and today, it continues to be a pivotal data link.

7. Vibrant Digital Ecosystem

India’s digital transformation is further propelled by its vast population and high demand for cloud services. Global tech giants like Amazon, Google, and Microsoft, have already established large datacenters in India and this demand is only growing as cloud computing, IoT, and AI continue to expand.

Subsea Cable Infrastructure: A Gateway to Global Markets

India’s subsea cable infrastructure plays a critical role in enhancing its appeal as a datacenter hub. Currently, there are 17 international subsea cables, landing in 14 distinct stations across 5 cities in India, connecting India to critical hubs in Europe, the Middle East, and Asia.

This not only supports India’s ability to meet growing global demand for data but also reduces latency for companies operating across regions, making India a preferred location for both Eastern and Western enterprises.

Future Outlook

The combination of cost-effective infrastructure, rapid expansion, robust subsea cable systems, and strategic government initiatives make India an increasingly attractive destination for datacenters.

Add to it the burgeoning digital ecosystem that is growing in the country, a strong datacenter sector is a compelling long-term solution for global companies looking to optimise their data and connectivity strategies.