By Piyush Somani, Managing Director and Chairman, ESDS Software Solution Ltd.
In an era defined by relentless digital acceleration, robust and sovereign digital infrastructure is no longer a peripheral consideration, it is a national imperative. The convergence of data-driven economies, strategic geopolitical posturing, and an increasingly assertive regulatory environment has elevated digital infrastructure to the center of global competitiveness and national security. Today, infrastructure is not just made of concrete and steel: it is built with cloud, compute, and connectivity. Nations that can architect resilient, localised, and sustainable digital ecosystems will hold a definitive advantage in the unfolding digital order.
The Inevitable Expansion of Digital Hubs
The global economy is undergoing a tectonic shift. AI, 5G, cloud, and IoT are generating exponential volumes of data, necessitating a corresponding scale-up in processing power and storage capabilities. As per JLL, India’s data center capacity is projected to grow by 77% by 2027, reaching 1.8 GW.
The economic implications are substantial. The Confederation of Indian Industry (CII) and Colliers project that India’s data center capacity across top cities will double to over 1,800 MW by 2026, necessitating an investment of approximately US$10 billion. This growth not only enhances digital capabilities but also generates employment and stimulates regional economies.
However, what’s particularly transformative is where this growth is happening. No longer confined to Tier-1 cities like Mumbai, Delhi, or Bengaluru, India’s digital infrastructure story is now playing out across states like Uttar Pradesh, Telangana, and Tripura. Uttar Pradesh’s strategic initiatives and proactive data center policies are enabling it to emerge as North India’s digital core, while Tripura is setting a precedent by taking digital capacity building to the country’s Northeast, a region long overlooked in tech investments.
Digital Sovereignty: The New Geo-Economic Lever
In a digitally interconnected world, data is power and increasingly, sovereignty over data is becoming as critical as sovereignty over territory. Governments globally are recalibrating their digital policies to assert greater control over data flows and ensure national interest is not compromised.
India is no exception. The enactment of the Digital Personal Data Protection Act (DPDPA) marks a significant inflection point in the country’s digital governance landscape. By mandating that sensitive personal data be stored and processed within Indian borders, the law underscores the strategic importance of data localisation both as a safeguard for citizen privacy and as a lever for national security and economic self-reliance.
Tech giants are taking note. OpenAI’s recent launch of local data residency capabilities for Indian enterprises is a reflection of the larger trend, where compliance is evolving into a competitive differentiator. Businesses that align with local regulatory expectations can gain not just legal immunity, but also the trust of millions of digital consumers.
Furthermore, localised data ecosystems create a multiplier effect: they reduce latency, enhance service delivery, empower domestic innovation, and enable local enterprises especially startups and MSMEs to become integral players in the global digital value chain.
Towards a Tiered and Sustainable Infrastructure Strategy
Digital infrastructure cannot be monolithic. The future lies in a tiered architecture where hyperscale data centers and edge computing nodes work in tandem to deliver real-time, low-latency digital services. Edge computing will play a transformative role in enabling smart cities, autonomous vehicles, and precision manufacturing, use cases that demand immediate data processing at the point of generation.
But as we scale, sustainability must remain a core design principle. Data centers are inherently energy intensive. A responsible expansion strategy necessitates the integration of green energy, liquid cooling systems, and energy-efficient architecture from the ground up.
Encouragingly, Indian players are leading the charge. For us at ESDS, sustainability is intrinsic to our infrastructure philosophy from patented auto-scaling cloud solutions that optimise energy consumption, to solar-powered data centers and water-efficient cooling systems.
Equally important is the collaborative fabric underpinning this growth. Strategic alliances between governments, infrastructure developers, and technology providers will be key to unlocking capital, de-risking projects, and ensuring compliance with evolving ESG and regulatory standards.
Geopolitics Meets the Cloud
The geopolitics of the 21st century is increasingly being shaped not by oil pipelines or naval routes, but by digital highways and data flows. Control over digital infrastructure is becoming a new form of soft power and countries are racing to ensure that critical infrastructure is secure, sovereign, and strategically aligned with national interests.
This is where India has a unique opportunity. As a trusted technology partner globally, with a robust talent base and maturing regulatory ecosystem, India can position itself as a global digital infrastructure hub not only serving its own billion-plus citizens but also becoming a preferred destination for cross-border data hosting and cloud services in the Indo-Pacific region.
Conclusion: Infrastructure That Shapes the Future
As we navigate the complexities of the digital age, the development of robust digital infrastructure emerges as a linchpin for economic growth, national security, and technological innovation. The strategic investments and policy initiatives undertaken today will shape the digital landscape of tomorrow. By prioritising localised infrastructure development, embracing data sovereignty, and fostering sustainable practices, nations can position themselves at the forefront of the global digital economy.
As the lines between digital growth, economic resilience, and geopolitical strategy blur, digital infrastructure becomes the bedrock upon which future-ready nations are built. By prioritising data sovereignty, democratising infrastructure development, and embedding sustainability at scale, India is well-positioned to not just keep pace with the digital revolution but to lead it. The choices we make today, in investment, regulation, and innovation will determine how resilient and inclusive our digital economy will be tomorrow and for visionary enterprises and policymakers alike, the time to act is now.