India’s data centre (DC) capacity is expected to exceed 3 gigawatts (GW) by the end of 2028, driven by rising demand from hyperscalers, artificial intelligence workloads and the country’s favourable development ecosystem, according to a report by CBRE.
The report, 2026 Asia Pacific Data Centre Trends & Outlook, said India has emerged as one of the region’s leading data centre markets, supported by a rapidly expanding digital economy, strong investment pipeline and improving infrastructure.
Capacity expansion gains momentum
According to CBRE’s India Alternate Sectors Outlook 2026, the country’s total data centre capacity reached 1,700 MW at the end of 2025. Another 500 MW of supply is expected to be added during 2026, placing India on a strong growth trajectory.
The report elevated India from the “High Growth” category to the “Leading Markets” segment in the Asia-Pacific region, placing it alongside Japan, Australia, South Korea, China and Malaysia.
CBRE Chairman and CEO – India, South-East Asia, Middle East and Africa Anshuman Magazine said India’s combination of low development bottlenecks, expanding digital adoption and strong hyperscaler commitments makes it one of the most attractive data centre markets globally.
India scores high on development ease
CBRE’s Data Centre Development Bottlenecks Scorecard, which evaluates power availability, construction costs, skilled labour availability and environmental risks, rated India as “Low” risk across all four parameters, making it the only major Asia-Pacific market to achieve that distinction.
Mumbai continues to dominate the sector with more than 800 MW of operational capacity and another 750 MW under construction or committed. Chennai, Hyderabad and Delhi-NCR are emerging as key hyperscale destinations, while Bengaluru remains a preferred enterprise colocation hub.
The report noted that data centre investments across Asia-Pacific touched a record $11.6 billion in 2025, with investors increasingly favouring development-led opportunities, platform investments and operating company transactions.
AI driving next phase of demand
Hyperscalers currently account for around 50-55% of India’s data centre demand, with cloud service providers contracting more than 300 MW of capacity during the January-March quarter.
However, demand is broadening beyond traditional cloud players to include neocloud operators, semiconductor firms, research organisations and global capability centres (GCCs). AI applications are accelerating requirements for higher rack densities, advanced cooling systems and more compute-intensive infrastructure.
The report also highlighted growing interest in Tier-II cities such as Jaipur, Ahmedabad and Lucknow, where edge data centres and containerised facilities are gaining traction.