India’s edge data centre capacity is set to skyrocket to 200–210 Megawatts (MW) by 2027, up from just 60–70 MW in 2024, marking a threefold increase, according to credit rating agency ICRA. This growth is driven by India’s adoption of emerging technologies and rising demand for low-latency data processing. Unlike large, centralised data centres, edge facilities are smaller and decentralised, positioned closer to end-users to reduce latency and enable real-time computing. ICRA reports that global data centre capacity currently stands at 50 Gigawatts (GW), with 10% attributed to edge data centres. India’s share in that is still nascent, accounting for just 5% of its total data centre capacity, and an even lower 1% when excluding captive facilities. With the cloud ecosystem expanding rapidly, edge data centres are poised to play a major role in digital infrastructure, complementing traditional data centres in a hub-and-spoke model.
Data Demand Drives Edge Surge
The demand for edge computing in India stems from its potential to support real-time services in sectors like healthcare, banking, defence, agriculture, and manufacturing. According to ICRA’s Vice President and Co-Group Head, Corporate Ratings, Anupama Reddy, edge data centres “differ from traditional data centres in multiple parameters like size, location, scale, time taken to construct, capex cost per MW, distance from end user, etc.” In India’s case, both traditional and edge models will act as complementary pillars. While traditional data centres continue to support AI, hyperscale cloud workloads, and bulk processing, edge data centres will handle real-time tasks, local services, and bandwidth-heavy user applications.
Data Players Set to Lead Expansion
- Retail-Centric Focus: Edge data centres will primarily cater to retail customers, unlike traditional centres which serve enterprise and hyperscale clients.
- Higher Rentals Expected: ICRA anticipates higher rental costs for edge centres due to their remote deployment and greater capex per MW.
- Premium Pricing Model: Operators are likely to recover higher investments through premium pricing strategies for low-latency, localised services.
- Leading Market Players: Key entities expected to spearhead expansion include RailTel, telecom operators, and major data centre providers.
- Tier II & III Momentum: Deployment is accelerating in tier II and III cities, where digital demand is growing and infrastructure is developing fast.
- Digital Ecosystem Expansion: India’s rising digital footprint will continue to drive a supportive environment for edge data infrastructure growth.
Data Growth Meets Deployment Challenges
Despite strong projections, edge data centres face several operational and structural challenges. According to ICRA, risks include security vulnerabilities due to remote locations, rapid tech upgrades leading to obsolescence, talent shortages in small cities, and interoperability issues with legacy systems. These challenges may slow short-term rollouts but are being addressed through government initiatives, private sector R&D, and industry-wide standardisation efforts. As India prepares for a more data-driven economy, tackling these obstacles remains key to unlocking the full potential of edge computing.
(With Inpuits From ANI….)
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