Google's $15-billion plan to build a one-gigawatt AI data centre in Visakhapatnam marks a new phase in the digital race. The hub promises to bring together data storage, renewable energy, and fibre connectivity—all in one place. It also fits into India’s strategic need to localise data storage as deep digitisation, 5G expansion, and AI adoption drive an unprecedented data surge. The Digital Personal Data Protection Act, 2023 requires local storage of citizens’ data. Yet, despite its growing digital footprint, most of India’s data still resides abroad. By one estimate, India generates nearly 20 percent of global data but can store barely three percent. Closing this gap is critical—not only for economic growth but also for national security and digital sovereignty.
Localised storage gives India greater control over its data economy, protects citizens’ privacy, and improves performance. Infrastructure placed closer to users sharply reduces latency, enhancing digital payments, streaming, and enterprise services. However, bottlenecks threaten this ambition. The industry points to high power costs, a maze of over 40 approvals, dependence on costly telco fibre, and the absence of specialised building codes. A project that should take 18 months to complete often takes two and a half years just to break ground.
India needs a clear, cohesive national policy for data centres. A single-window clearance system can eliminate delays. Operators must be allowed to build their own fibre networks. A nationwide open-access power policy can unlock cheaper, greener energy. And incentives must push development into Tier-2 and Tier-3 cities, creating a distributed, resilient digital backbone.
Another concern looms—water. Data centres are thirsty, consuming vast quantities for cooling. With many Indian cities already water-stressed, unchecked expansion could spark a sustainability crisis. The answer lies in advanced cooling technologies and wastewater recycling—as vital as regulatory reform or power access. India’s digital future depends as much on smart governance and resource management as it does on AI and algorithms. The next phase of growth will hinge not just on data, but on how wisely we power and cool it.
