Soon, India to be the next DC hub: NASSCOM
Published 2 March 2021
India’s IT industry body NASSCOM has said that the country is on path to become the next data centre hub, as the pandemic has resulted in making the internet the lifeline of people workig from home and for entertainment purposes.
This in turn has resulted in an increased demand for cloud across the world. The shift towards cloud has resulted in an increased investment in hyper-scale datacenters, according to a NASSCOM report.
India has a huge potential to take away a large share of the global data centre investments, if it is able to act fast on implementing the recently announced data centre draft policy. It could grow 2X-3X CAGR with annual investments reaching $6-8 billion by 2025, observed NASSCOM.
Further, NASSCOM is also of the view that the data centre with global data centre market investments are expected to reach $200 billion per annum by the year 2025. India is also expected to get a share in this growth with investments in the country are expected to reach $5 billion per annum by the year 2025.
A significant increase in the data traffic during the COVID-19 pandemic has lead to an increased need for the investment in the data centres.
These developments need to be seen in the backdrop of a a global data centre market, which is expecting cumulative investments of $1.3 trillion till 2025. The COVID-19 pandemic has increased data traffic and has pushed the occupancy rate of colocation data centres, thereby increasing investments in the sector.
North America is the leading market in terms of investments, while MEA and Latin America are fastest growing markets, followed by APAC.
IT infra accounts for 77 per cent of the total share of data centre investments, while the remaining is in electrical, mechanical infrastructure and general constrcution. Even a temporary halt in construction of data centres during the lockdown has quickly recovered.
Mumbai, Chennai, Bengaluru, Hyderabad, Delhi (NCR) will be amongst the major datacenter locations in India as they offer good fiber connectivity, proximity to it’s customers, an availability of skilled workforce and submarine cable connectivity. A cumulative investment of $ 1.3 trillion is expectd over 2019-2025. Out of the total share of data center investments the IT infrastructure accounts for 77 per cent of the share.