India / Bhārata: What India's new government policy means for the data center industry

The Indian government is introducing new policies that will encourage data center growth in the country, it has been announced. This policy announcement comes as leaders strive to make the country a hub for the world’s growing data traffic. In the government’s 2022 budget, provisions have been made to make borrowing cheaper for operators. 

Critically, as part of the new policy change, data centers will be classified in the infrastructure sector bracket; as such they will be enabled to raise long-term credit at cheaper rates, and use “external commercial borrowing.”

 

Rachit Mohan, Head, Data Center Advisory, India, Co-Head, Office Leasing Advisory, commented: “The policy initiatives announced in this year’s budget will accelerate the data centre industry growth and spur investments in India.” Adding: “It’s coming at a time when demand for such real estate had already been heating up.” 

Alongside this draft data center policy, the government, back in August announced the launch of an incentive scheme worth up to Rs 12,000 to encourage companies to set up data centers in the country. 

Speaking to ET at the time of the announcement, a spokesperson said: “Our vision is to make India a global data centre hub. We have proposed that ease of doing business has to be improved and the bottlenecks have to be addressed.”