Data Sovereignty and Data Centre Industry in India

Data sovereignty has become a national priority, emphasizing the need for infrastructure governed by domestic entities. Policymakers are focusing on this issue at forums such as the AI Impact Summit, where the ownership of data centres is a key theme. The protection and processing of citizens' data require a framework of predominantly domestic ownership.

Recent Investments and Growth

• Indian and international conglomerates plan to invest approximately $50 billion in the Indian data centre industry over the next five to seven years.
• India's data centre capacity is projected to expand from around 1 gigawatt to 9 gigawatts.

Space as a New Frontier

• Agnikul Cosmos, a Chennai-based space technology startup, is collaborating with NeevCloud to create India’s first AI-driven orbital data centre in low Earth orbit.
• The project aims to overcome terrestrial limitations such as power, cooling requirements, and network latency.
• A proof of concept mission is planned before the end of the year, with commercial operations targeted for 2027.
• The partnership intends to establish over 600 orbital edge data centres within three years.

Current Data Centre Ownership Landscape

According to Arun Malhotra, CEO of Parity Infotech Solutions:

• Domestic-controlled data centre capacity is estimated at 40-45%.
• Foreign-controlled capacity is around 35-40%.
• Joint ventures or mixed ownership account for 15-20%.

Ownership is a weak proxy for control, especially considering hyperscaler cloud regions, which are entirely foreign-controlled despite being hosted in India.

Reducing Foreign Dependence

• Mitigating reliance on foreign technology vendors involves reducing single-point dependencies and lock-in.
• Progress is monitored through six annual metrics: vendor concentration, platform exit readiness, indigenous value contribution, lifecycle and licensing control, supply-chain and geopolitical exposure, and sovereign capability adoption rate.

These metrics help measure sovereignty and promote resilience, ultimately transforming technology sovereignty into a competitive advantage for India.

Conclusion

India's data centre ecosystem is partially sovereign, with significant foreign influence, especially at the platform level. True sovereignty can be measured through composite metrics, positioning India as a digital partner for emerging economies.