How Will Data Centre Capacity in Smaller Indian Cities Expand by 2030?
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Synopsis
Discover how India's tier 2 and tier 3 cities are set to transform the data centre landscape by 2030. With capacity expected to increase significantly, these emerging hubs are reshaping the digital economy and bridging the urban-rural divide. Explore the factors driving this change and what it means for India’s future.
Key Takeaways
- Tier 2 and tier 3 cities currently hold 6% of India's data capacity.
- Capacity is expected to grow to 300–400 MW by 2030.
- These cities are becoming essential for edge computing and innovation.
- Government policies and decentralisation are key drivers of this growth.
- Technological advancements are improving efficiency and sustainability.
New Delhi, Aug 13 (NationPress) Currently, India's tier 2 and tier 3 cities contribute merely 6% of the nation's data centre capacity, equating to about 82 MW. However, projections indicate that by 2030, this capacity will surge to between 300–400 MW, according to recent analyses.
The overall data capacity of India is anticipated to surpass 4,500 MW in the same timeframe, highlighting the nation's critical role in bolstering the digital economy.
Traditionally, major cities such as Bengaluru, Delhi, and Mumbai have led the data landscape. Nevertheless, tier 2 and tier 3 cities are emerging as pivotal players in the ongoing digital transformation.
Locations like Kochi, Mohali, Jaipur, and Indore are swiftly becoming significant centres for edge computing, data centres, and technological innovation. Once regarded as secondary, these cities are now essential to the vision of a decentralised digital India.
Factors such as supportive government policies, decentralisation of businesses, and the increasing demand for local data processing are propelling this transformation.
These regions offer distinct advantages, including favourable business conditions, lower operational expenses, and proximity to end users.
For these cities to thrive, however, a robust and flexible data infrastructure is necessary. Modular, pre-engineered data centre solutions are gaining traction due to constraints related to space, cooling challenges, and limited local resources, reports suggest.
Innovations like liquid cooling and AI-optimised airflow facilitate high-density computing at edge locations without compromising efficiency.
The current focus has shifted from merely scaling operations to prioritising efficiency, resilience, and sustainability as smaller cities emerge on the digital horizon.
AI-powered cooling, intelligent power distribution, and real-time energy monitoring are responding to the demands of AI and high-performance computing while achieving environmental goals.
This moment marks a significant shift. The narrative of India's data growth is no longer confined to its largest metropolises; it is expanding into regional centres that strengthen the nation's infrastructure, create new markets, and help close the digital gap.
By investing in these burgeoning centres, we are not just enhancing capacity; we are also fostering a more connected, inclusive, and dynamic India.
Point of View
I believe the growth of data centres in smaller cities is not just a trend; it's a transformative shift in India's digital landscape. This evolution signifies a commitment to building a more inclusive and resilient infrastructure, ensuring that no region is left behind in our digital journey.
NationPress
08/10/2025
Frequently Asked Questions
What percentage of data centre capacity do tier 2 and tier 3 cities currently hold?
Tier 2 and tier 3 cities currently hold about 6% of India's data centre capacity.
What is the projected capacity for these cities by 2030?
The projected capacity for tier 2 and tier 3 cities is expected to rise to between 300–400 MW by 2030.
What role do smaller cities play in India's digital economy?
Smaller cities are becoming crucial hubs for edge computing and data centres, significantly contributing to the country's digital economy.
What factors are driving the growth of data centres in these regions?
Encouraging government regulations, business decentralisation, and the increasing need for localised data processing are key factors driving growth.
How are technological innovations impacting data centres?
Emerging technologies like liquid cooling and AI-optimised airflow are enhancing efficiency and enabling high-density computing at edge sites.
