India's Data Centre Growth: Navigating Through Malaysia and Japan.

27 Sep, 2024

India's Data Centre Growth: Navigating Through Malaysia and Japan

India currently leads in leased data center capacity among emerging markets, boasting between 1-3 GW. According to a research note by S&P Global, India is positioned to become a key player in the data center industry, although it may face stiff competition from countries like Malaysia and Vietnam. The report anticipates over $100 billion in investments for data center facilities across the Asia-Pacific region within the next five years. This surge in funding is driven by escalating data demands, the growth of artificial intelligence (AI), cloud computing, and ongoing digitalization efforts.

The Indian government is exploring subsidies to stimulate data center development, aiming to harness the AI boom and facilitate greater access to computing resources for startups and research institutions. With computing power being a crucial aspect of large AI systems, government support is vital, especially for smaller enterprises that struggle with high costs and limited accessibility. Emerging markets in the Asia-Pacific are expected to experience more rapid capacity growth compared to established markets.

While India leads in capacity, Malaysia is projected to see faster growth in the sector from 2023 to 2028. Nevertheless, India's less stringent data sovereignty regulations may give it a competitive advantage over Malaysia, supporting its ambitions in the data center landscape.