India’s data center capacity is set to increase 66 percent by 2026, according to a recent report from JLL.

The Indian data center industry will add 604MW of capacity in the next two and a half years, requiring 7.3 million sq ft of space and an investment of $3.8 billion.

The growth has been attributed to artificial intelligence (AI) and India’s nationwide rollout of 5G.

“India is rapidly establishing itself as a global center for AI innovation and data center growth. Hyperscalers are increasingly pursuing self-build projects in major data center hubs, while operators are planning new campuses powered by 400kVA lines to support AI clusters,” said Rachit Mohan, APAC lead of data center leasing at JLL.

“Navi Mumbai, a satellite city near Mumbai, is emerging as a key data center location, with potential demand expected to reach 800MW in the next few years.”

Dr. Samantak Das, chief economist and head of research & REIS at JLL India, added: “Mumbai is expected to maintain its market leadership, while we anticipate significant growth in Chennai and other regions. This expansion is not only driving demand for specialized skills but also creative opportunities across backward-linked industries.”

The report added that, in the past four years, the data center industry has grown at 24 percent CAGR. In the first half of this year, the data center industry reached a capacity of 917MW with 873MW occupancy.

India is a rapidly growing data center market, with the majority of facilities concentrated in Mumbai, Hyderabad, and Bangalore. Operators include Airtel’s Nxtra, STT GDC, CtrlS, Iron Mountain, NTT, Yotta, and Equinix.

Earlier this year, a report from DC Byte said India led growth in the APAC region’s data center market with many hyperscalers choosing to invest in the country.

AWS and STT GDC have both announced recent plans to invest $2 billion and $3.2 billion in the nation, respectively.