What a start to the month! November began with a bang, marked by the election for the world’s most important position. Donald Trump and his Republican Party achieved a clean sweep, winning the Presidential race and securing a majority in both the Senate and Congress, and creating a “Red Wave”. Trump’s policies and their beneficiaries will become clearer in the coming days, and I hope India plays an important role during his tenure.
This week, however, we will discuss a sector with massive potential in India.
Data Centers
While we all know that our data is stored on the Cloud, did you know that it is still stored physically some place! And can you guess where that might be?
This is where data centers come into play.
Data centers are specialized facilities that house servers, storage systems, networking equipment, and other computing resources essential for storing, managing, and processing data.
Think of them as the backbone of the internet and digital services—everything from social media and banking apps to e-commerce platforms relies on data centers to function seamlessly.
These centers ensure data remains secure and accessible, while maintaining optimal performance through advanced cooling systems and power management solutions.
Types of Data Centers
Data centers come in several types, each designed to meet specific needs:
But why is there so much investment happening in Data Centers?
As the world generates and stores more data in cloud, the demand for larger data centers is skyrocketing. With AI becoming integral to numerous industries, the need for fast, low-latency data processing has intensified—precisely what data centers are designed to deliver.
In India, although we generate about 20% of the world’s data, our data center capacity accounts for just 3% of the global total.
In addition, the government’s push for data localization requires that transaction and social media data be stored within the country. These factors have put data centers firmly in the spotlight.
India is already making strides to bridge the gap. Our data center capacity is projected to grow from 1.03 GW in FY24 to 3.29 GW by FY28, with emerging hubs in cities like Mumbai, Chennai, and Hyderabad.
In the context of data centers, GW (gigawatts) refers to the power capacity needed to run servers, cooling systems, and other equipment. To give you an idea, a 1 MW data center could store 10-15 petabytes (1 PB = 1000 TB) of data, though the exact amount depends on its specific design and technologies.
Who are the beneficiaries in India?
India’s data center sector has a long way to go, but it’s set for significant growth in the coming years, with positive impacts likely across multiple industries.
We hope you enjoyed this newsletter! We’d love to hear your thoughts, and if there’s another topic you’d like us to cover, feel free to email us at connect@incredmoney.com.
Till the next time,
Vijay
CEO – InCred Money
P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.
