India is preparing for a major leap in digital infrastructure. The draft National Data Centre Policy proposes incentives that could transform the economics of building and running facilities, positioning the country as a serious global hub for cloud, AI, and digital storage.
A Game-Changing Incentive Package
The policy proposes a 20-year tax holiday for developers and GST input credit on capital assets like HVAC systems, electrical gear, and construction materials removing key cost barriers for new projects.
A Call to Global Investors
Foreign firms operating or leasing over 100 MW will get permanent establishment (PE) status. While this carries tax obligations, it provides clarity and stability, encouraging deeper investments from global cloud players.
Linking AI with Infrastructure
The policy encourages operators to set up AI development centres and capability hubs alongside data facilities shifting India’s role from storage hub to innovation powerhouse.
The Energy Question
Power remains the biggest challenge. States will be pushed to provide land near IT corridors with reliable, renewable energy access. The policy also emphasizes stricter PUE standards and explores advanced options like modular reactors and grid-scale storage to secure long-term supply.
The Growth Story
India’s data centre capacity has grown at 24% CAGR since 2019. Another 795 MW is expected by 2027, taking the total to nearly 1,825 MW. With incentives, this growth could accelerate sharply.
Key players such as Yotta Infrastructure, AdaniConneX, ESDS Software, Xtranet Technologies, and Comtel Infosystems are already scaling aggressively, highlighting strong momentum in the sector.
Why Investors Should Pay Attention
This policy is about more than tax breaks it’s about reshaping India’s role in the global digital economy. Developers gain better margins, global firms gain stability, and investors gain access to a high-growth sector with long-term potential.
Bottom Line
India’s draft data centre policy is a bold blueprint that could unlock a once in a decade opportunity. Early movers Yotta, ESDS, AdaniConneX, Comtel Infosystems, and Xtranet are already positioning themselves for the boom.
The race for India’s data goldmine has just begun.