India data centre capacity to jump 30% in 2026; 500 MW supply boost expected: CBRE report
The report noted that data centre investments reached $56.4 billion in 2025, taking cumulative commitments to $126 billion. This is projected to rise by about 45% year-on-year to exceed $180 billion in 2026.
- Apr 1, 2026,
- Updated Apr 1, 2026 2:32 PM IST
India’s data centre capacity is set for another year of strong growth, with total stock across major cities expected to rise by about 30% year-on-year in 2026, driven by an estimated 500 MW of fresh supply, according to a report by CBRE Group.
The expansion builds on a record 2025, when the country’s total data centre capacity crossed the 1,700 MW mark, supported by a supply addition of 440 MW, up 160% from the previous year.
“The data centre story in India is no longer about potential but about execution at scale. The sector’s resilience and attractive return potential are establishing it as a primary focus for investors, with foreign capital playing a dominant role,” said Anshuman Magazine, Chairman & CEO, India, South-East Asia, Middle East & Africa, CBRE.
He added that “this interest is supported by a robust regulatory framework that continues to enhance transparency and streamline credit access. The institutional momentum is expected to drive a significant upswing in deployments, positioning India as one of the fastest growing and most dynamic DC markets in the Asia-Pacific region.”
Investments surge, pipeline strengthens
Investment momentum in the sector is also accelerating. The report noted that data centre investments reached $56.4 billion in 2025, taking cumulative commitments to $126 billion. This is projected to rise by about 45% year-on-year to exceed $180 billion in 2026.
The report noted that data centres have now emerged as a mainstream asset class and are increasingly attracting institutional capital, ranking among the most preferred sectors for investors in the Asia-Pacific region. Beyond metros, tier-II cities gain traction
While states such as Telangana, Maharashtra, Tamil Nadu, Andhra Pradesh and Uttar Pradesh are expected to lead investments, developers are also expanding into tier-II markets. Cities including Ahmedabad, Visakhapatnam, Patna and Bhopal are seeing increased interest, driven by demand for lower latency, 5G rollout and data localisation requirements.
Mumbai continues to dominate the landscape, accounting for over 50% of India’s operational data centre inventory as of end-2025, according to the report. Along with Chennai, Delhi-NCR and Bengaluru, it makes up nearly 90% of the country’s tier-I capacity.
Power, sustainability emerge as key challenges
As capacity scales, energy demand is becoming a critical factor.
“Rapidly scaling AI and cloud infrastructure is placing unprecedented strain on power grids in high-density DC hubs. Consequently, renewable energy procurement has become a structural pillar of supply-side strategy, balancing sustainability with long-term power security,” said Ram Chandnani, Managing Director, Leasing, CBRE India.
India added a record 44.5 GW of renewable capacity in 2025, nearly doubling the previous year, underlining the sector’s shift towards green energy sourcing.
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India’s data centre capacity is set for another year of strong growth, with total stock across major cities expected to rise by about 30% year-on-year in 2026, driven by an estimated 500 MW of fresh supply, according to a report by CBRE Group.
The expansion builds on a record 2025, when the country’s total data centre capacity crossed the 1,700 MW mark, supported by a supply addition of 440 MW, up 160% from the previous year.
“The data centre story in India is no longer about potential but about execution at scale. The sector’s resilience and attractive return potential are establishing it as a primary focus for investors, with foreign capital playing a dominant role,” said Anshuman Magazine, Chairman & CEO, India, South-East Asia, Middle East & Africa, CBRE.
He added that “this interest is supported by a robust regulatory framework that continues to enhance transparency and streamline credit access. The institutional momentum is expected to drive a significant upswing in deployments, positioning India as one of the fastest growing and most dynamic DC markets in the Asia-Pacific region.”
Investments surge, pipeline strengthens
Investment momentum in the sector is also accelerating. The report noted that data centre investments reached $56.4 billion in 2025, taking cumulative commitments to $126 billion. This is projected to rise by about 45% year-on-year to exceed $180 billion in 2026.
The report noted that data centres have now emerged as a mainstream asset class and are increasingly attracting institutional capital, ranking among the most preferred sectors for investors in the Asia-Pacific region. Beyond metros, tier-II cities gain traction
While states such as Telangana, Maharashtra, Tamil Nadu, Andhra Pradesh and Uttar Pradesh are expected to lead investments, developers are also expanding into tier-II markets. Cities including Ahmedabad, Visakhapatnam, Patna and Bhopal are seeing increased interest, driven by demand for lower latency, 5G rollout and data localisation requirements.
Mumbai continues to dominate the landscape, accounting for over 50% of India’s operational data centre inventory as of end-2025, according to the report. Along with Chennai, Delhi-NCR and Bengaluru, it makes up nearly 90% of the country’s tier-I capacity.
Power, sustainability emerge as key challenges
As capacity scales, energy demand is becoming a critical factor.
“Rapidly scaling AI and cloud infrastructure is placing unprecedented strain on power grids in high-density DC hubs. Consequently, renewable energy procurement has become a structural pillar of supply-side strategy, balancing sustainability with long-term power security,” said Ram Chandnani, Managing Director, Leasing, CBRE India.
India added a record 44.5 GW of renewable capacity in 2025, nearly doubling the previous year, underlining the sector’s shift towards green energy sourcing.
For Unparalleled coverage of India's Businesses and Economy – Subscribe to Business Today Magazine