India Data Center Market Sees $35 Billion Capex Opportunity

India's data center industry is undergoing a massive expansion driven by artificial intelligence, cloud adoption, and government data localization rules. Nomura Holdings estimates that incremental capacity of 5.1GW will create a $35 billion capital expenditure opportunity for industrial equipment manufacturers by 2030. The brokerage projects total capacity will reach nearly 7GW by 2030, growing at a 30% compound annual growth rate.

Nomura identifies the industrial supply chain as the most attractive investment area, assigning buy ratings to GE Vernova T&D India and CG Power. The brokerage highlights India's cost efficiency, noting construction costs of $6-7 million per MW, significantly lower than the $10-18 million seen in developed markets. CG Power recently exemplified this growth by securing a Rs 900 crore transformer export order for a US hyperscale project in January 2026.

Analysis from Knight Frank India shows that live IT capacity exceeded 1.6GW by the end of 2025, with a development pipeline now surpassing 8GW. AI-related workloads, including generative AI and machine learning, now account for nearly 20% of total leasing demand. While Mumbai remains the dominant hub with 47% of live capacity, Hyderabad is emerging as a major AI center, with Visakhapatnam and Jamnagar also signaling new infrastructure growth. Despite this momentum, the sector faces headwinds regarding power availability, transmission capacity, and regulatory approvals.