US Leads Global Data Center Surge as India Prepares for Major Expansion
The rapid expansion of data centers is being fueled by the surge in AI technologies, which require substantial computing power and storage. This has contributed to the market growing by 52 percent since 2017, reaching a valuation of $416 billion. Projections suggest the global data center market will continue growing at a compound annual growth rate (CAGR) of 8.45 percent, potentially becoming a half-trillion-dollar industry by 2027. In the U.S., the data center market is expected to generate over $120 billion in 2024, accounting for about 30 percent of total global market revenue.
India, meanwhile, is preparing for a significant data center boom. The country's data center capacity nearly doubled from 540 megawatts (MW) in 2019 to 1,011 MW in 2023, making it one of the fastest-growing markets globally. With a projected CAGR of 26 percent over the next three years, India could add an additional 500 MW of capacity within the next four years. This growth has drawn attention from a range of investors, including private equity, pension funds, and sovereign wealth funds. According to Savills India, data center absorption grew by 21 percent in the first half of 2024, driven by demand from tier 2 and 3 cities for edge data centers.