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Mumbai is the preferred choice for large cloud players and new supply in data center in H1 2020: JLL

by Editorial
August 31, 2020
in Featured, Mobile/Digital
3 min read
Mumbai is the preferred choice for large cloud players and new supply in data center in H1 2020: JLL
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Mumbai: Mumbai has witnessed highest capacity addition in H1 2020, as it continues to be the preferred choice for large cloud players according to JLL’s H1 2020 ‘re (Imagine) Data Centers Running India’s digital economy’ report released. The city also accounts for 62% of India’s total cloud capacity, followed by Pune and Chennai. Additionally, due to its infrastructural benefits, it continues to command premium for enterprise demand, followed by Hyderabad and Chennai. Further, the city is expected to witness the highest capacity addition of ~360 MW during 2020-2025, followed by Chennai with a capacity addition of 134 MW.

India’s data center capacity is expected to grow from 375 MW in H1 2020 to 1,078 MW by 2025, presenting a USD 4.9 billion investment opportunity. According to JLL’s H1 2020 ‘(re) Imagine Data Centers Running India’s Digital Economy’ report, the impact of data protection laws, increased shift from captive to colocation (colo) data canters and implementation of new technologies like 5G, edge computing and the internet of things (IoT) will drive sustained investor demand for this asset class over the next five years.

Karan Singh Sodi
Karan Singh Sodi

“India’s data center market will outperform over the next five years, supported by a combination of growing digital economy, increased investor interest and stable long-term returns. Growth in the sector will be further powered by colocation sites which, via, lower upfront costs, heightened data security, uninterrupted services and scalability will, further, influence investors to reimagine the potential of India’s data canter space. Within Mumbai, Navi Mumbai has already emerged as location of choice by various players.” said Karan Singh Sodi, Regional Managing Director – Mumbai, JLL India

India’s data canter industry has provided an immense boost to the digital economy during H1 2020. Daily data consumption rose from an average of 270 petabytes (PB) during pre-lockdown period to an average of 308 PB post lockdown period registering a 14% rise.

There was a 12% rise in data consumption in Andhra Pradesh and Bihar, while there was a 7% increase in data consumption in Maharashtra which is the highest data consumer. In terms of total capacity addition, there has been an increase of 8% in H1 2020, taking India’s total colocation capacity to 375 MW. H1 2020 witnessed supply addition of 27 MW, which is 56% of the total addition seen in 2019 (48 MW). Mumbai continued its lead with addition of 19MW, followed by Bengaluru at 5 MW and Delhi NCR at 3 MW.

“Powered by the transition to work from home arrangements during lockdown, the country’s data center industry became the backbone of the digital economy and ensured a level of business continuity and sustained large portions of the country’s education system. Given shifts in the economy, we will continue to see data consumption increase manifold for the foreseeable future,” said Rachit Mohan, India Head, Data Center Advisory, JLL.

The dependence of several industries on digital infrastructure has partially helped mitigate the impact of the lockdown as IT/ITeS, Banking and Financial Services, e-commerce, capital markets, social media and education remained operational.

 Dr Samantak Das
Dr Samantak Das

“Mumbai is expected to see highest capacity addition as it continues to be the preferred choice for large cloud players because of its infrastructure advantage. Chennai is also proving to be a attractive destination due to its advantages of submarine cable landing stations and low development costs.” says Dr Samantak Das, Chief Economist and Head of Research & REIS, JLL India

India’s Data Centre industry is thus expected to travel through an interesting transition phase in terms of operators, locations and technology as the world’s second-largest data subscriber population increasingly adapts to a new digital world.

Tags: Dr Samantak Das JLL IndiaJLL’s H1 2020Karan Singh Sodi JLL India

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