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India's Edge Data Centre Capacity Set To Triple By 2027: Report
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Last Updated: July 25, 2025, 12:15 IST
Currently, edge data centres account for about 5% of India's total data centre capacity.
India's edge data centre industry is poised for exponential growth, with capacity projected to triple to 200-210 megawatts (MW) by 2027 from the current 60-70 MW, according to the latest report by credit rating agency ICRA. This surge is expected to be driven by the rapid adoption of emerging technologies such as the Internet of Things (IoT), 5G, augmented and virtual reality (AR/VR), and generative artificial intelligence (AI).
Edge data centres are smaller, decentralised facilities located closer to end-users and devices. Unlike traditional centralised data centres, which are typically large and centralised, edge facilities enable real-time data processing with minimal latency (the delay between a user action and the corresponding system response). This makes them ideal for supporting emerging technologies such as IoT, 5G, AR/VR, and GenAI. These new-age applications and technologies are forecasted to grow significantly in the medium term, resulting in an increased demand for edge data centres.
Currently, edge data centres account for about 5% of India's total data centre capacity. However, when excluding capacity used for captive purposes by a major player, the share drops to as low as 1%. ICRA expects this figure to grow significantly, with edge data centres expected to make up 8% of the total capacity by 2027. P: Projected (Source: ICRA Research)
'Edge data centres differ from traditional data centres in multiple parameters like size, location, scale, time taken to construct, capex cost per MW, and proximity to the end user," said Anupama Reddy, vice-president and co-group head (corporate ratings) at ICRA. 'In the Indian context, traditional data centres and edge data centres are complementary pillars of digital infrastructure."
Reddy said India's data infrastructure will increasingly adopt a 'hub-and-spoke' model. Traditional data centres will continue to support large-scale computing and AI workloads, while edge data centres will handle real-time, location-sensitive operations in sectors such as healthcare, banking, agriculture, Defence, and manufacturing.
Globally, edge data centres are estimated to account for around 10% of the total data centre capacity, which stood at 50 gigawatts (GW) as of December 2024. The United States currently dominates the global edge data centre market with a 44% share, followed by the Europe-Middle East-Africa (EMEA) region at 32%, and the Asia-Pacific (APAC) region at 24%. India remains a relatively new entrant but is expected to accelerate its adoption in the coming years.
Despite a promising outlook, the growth of edge data centres is not without challenges. Security vulnerabilities are a concern due to their deployment in remote Tier II and Tier III cities. Moreover, a shortage of skilled professionals in these regions, rapid technological shifts that could render infrastructure obsolete, and interoperability issues with traditional data centres pose significant hurdles.
'Rentals for edge data centres are anticipated to be on the higher side compared to traditional data centres, as they cater primarily to retail customers, unlike traditional centres which serve enterprise and hyperscale clients," Reddy noted. 'The higher capital expenditure per MW for edge data centres is expected to be offset by these higher rentals."
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ICRA also highlighted that established data centre players, as well as entities such as RailTel and telecom operators, are likely to lead India's edge data centre expansion over the next few years.
As digital demand continues to rise across urban and rural India, edge data centres are set to play a critical role in ensuring faster, more efficient digital services, marking a new chapter in the country's technological advancement. Mohammad Haris
Haris is Deputy News Editor (Business) at He writes on various issues related to personal finance, markets, economy and companies. Having over a decade of experience in financial journalism, Haris h... Read More
Haris is Deputy News Editor (Business) at He writes on various issues related to personal finance, markets, economy and companies. Having over a decade of experience in financial journalism, Haris h... Read More Stay updated with all the latest business news, including market trends, stock updates, tax, IPO, banking finance, real estate, savings and investments. Get in-depth analysis, expert opinions, and real-time updates—only on News18. Also Download the News18 App to stay updated! view comments Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
