India is on track to expand its data centre market rapidly, supported by favorable demographics, deep engineering talent, and its strategic proximity to the Middle East, according to a Goldman Sachs report.

The report, titled Outlook for Data Centers in Asia, states that data centre demand is expected to grow at a 20% compound annual growth rate (CAGR) in China from 2025 to 2028, driven by structural developments in AI and stepped-up investments by hyperscalers and large language model companies.

The report identifies India, Japan, and the Philippines as key growth markets in the broader Asian region.


Overall, the outlook for data centres in Asia is exceptionally robust, characterised by a broad and steep growth curve, the study stated.

According to a recent Knight Frank India report, the total development pipeline in India’s data centre sector will reach 8.33 GW. The scale of future supply, driven by accelerating artificial intelligence adoption, cloud computing growth and data localisation requirements, is more than five times the country's current live data centre capacity of 1.6 GW, it said.

The Knight Frank India report added that India currently has 0.32 GW of data centre capacity under construction, while another 2.92 GW has reached the committed stage. An additional 5.41 GW is in early stages of development, underscoring the depth of supply planned across key hubs.

ET had earlier reported that research associated with Cornell University pegged the global data centre market at about $250 billion in 2023, with expectations that it could double by 2030.

This growth is expected to be driven by hyperscaler expansion, enterprise AI adoption, graphics processing unit infrastructure demand, and modernisation of existing infrastructure environments.