India’s race toward becoming a global hub for Artificial Intelligence (AI) has uncovered a significant infrastructure challenge. According to a new Deloitte report titled “Attracting AI Data Centre Infrastructure Investment in India,” the country will need an additional 45–50 million square feet of real estate and 40–45 terawatt-hours (TWH) of power by 2030 to cater to the rapidly growing demand for AI-powered data centres.

The report draws attention to India’s competitive advantage, such as lower operating costs, abundant renewable energy potential, and strategic geographic positioning. These factors make India a lucrative destination for global AI infrastructure investment. However, Deloitte strongly cautions that this opportunity can only be harnessed if critical policy, regulatory, talent, and infrastructure bottlenecks are addressed swiftly and strategically.

To support the India data centre growth trajectory, Deloitte highlights six enablers essential for building a world-class AI ecosystem:

• Real estate

• Power and utilities

• Connectivity

• Compute infrastructure

• Skilled talent

• A conducive policy framework

Each of these enablers is vital for facilitating large-scale deployment of AI infrastructure investment. Deloitte argues that if India seeks to lead the AI data centres space globally, it must bridge these infrastructure gaps immediately.

One of the report’s key proposals is to give data centres a distinct classification under the National Building Code. This would streamline the approval process and encourage private sector participation. Another suggestion is to recognise data centres as essential services under the Essential Services Maintenance Act, enabling quicker clearances and prioritised support, especially during crises.

Deloitte further calls for:

• Dedicated data centre zones

• Relaxation of data localisation norms

• Regulatory harmonisation across laws, including amendments to the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023

• Exemptions from surveillance provisions under the Telecommunication Act, 2023

These changes aim to not only facilitate local development but also attract foreign direct investment (FDI) through innovative ideas like ‘data embassies’—secure data hubs for foreign governments and organisations hosted on Indian soil. This would position India as a trusted global data hosting partner.

Moreover, the report recommends implementing safe harbour rules for hosting service providers, offering them legal protection and compliance certainty. This will encourage cloud service providers and multinational tech companies to establish long-term infrastructure bases in India.

Despite the promising projections, the report warns of critical infrastructure stress, especially on India’s electricity grid. The anticipated 45 TWH increase in power consumption due to AI-driven data centre demands could challenge the current power generation and distribution systems. Deloitte emphasises the need for enhanced power generation capacity, particularly from renewable sources, to sustain this growth.

Connectivity remains another stumbling block. While metro cities have seen steady progress in internet infrastructure, rural and semi-urban areas lag significantly. The low fibre optic penetration and inconsistent high-speed internet coverage limit the deployment of edge data centres and affect overall AI scalability in India.

In her remarks, Neha Aggarwal, Partner at Deloitte India, stated, “If India is to become a global leader in AI data centre development, scalable infrastructure, cutting-edge compute systems, and agile policy reforms are indispensable.” She further added that only with consistent government support, private sector participation, and targeted policy innovation, can India meet the projected demand for data centres by 2030.

The Deloitte AI report 2025 also sheds light on the importance of building local talent pools skilled in data science, cloud computing, network engineering, and AI operations. Without this, infrastructure alone cannot sustain the transformation.

In conclusion, India is well-positioned to take on a leadership role in the AI revolution, provided it accelerates its infrastructure readiness and navigates the regulatory complexities smartly. The report makes a compelling case for proactive intervention from policymakers, industry stakeholders, and technology leaders. If the recommended actions are implemented within the suggested timeline, India could redefine the global data centre landscape by 2030 and emerge as a key player in the AI-driven digital economy.

As demand surges, the urgency to plan and execute robust data infrastructure strategies becomes non-negotiable. From data localisation reforms to renewable power integration, from skilled talent development to policy flexibility, India’s success in the AI data centre arena will depend on how swiftly it can align its systems and resources toward this ambitious yet achievable goal.

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