Gandhinagar: Gujarat has set target of developing 7.5GW of data centre capacity, five times India’s current installed capacity of around 1.5GW, with proposals totalling nearly 17GW already received under the state’s new data centre policy.Science and technology minister Arjun Modhwadia told Gujarat assembly on Friday that if the proposals materialise fully, they could bring more than Rs 17 lakh crore in investment to the state. He said both domestic and international companies have shown interest in establishing data centres in Gujarat.“Data centres are the oil wells of the present era,” Modhwadia said, describing the policy as an effort to make Gujarat a “prime mover” in country’s AI revolution.The Viksit Gujarat Data Centre Policy 2026-29, announced on July 9 provides a slew of incentives including capital and interest subsidies, SGST reimbursement, electricity-related concessions and reimbursement of stamp duty and registration fees. Projects setting up captive desalination plants will also be eligible for capital assistance.The policy also provides additional concessions related to floor space index, parking, ground coverage, building height and stacking of diesel generators, aimed at facilitating large-scale data-centre development.A key component of the policy is access to renewable energy. Data centre operators will have to source at least 51% of their electricity consumption from green and renewable sources. The policy also permits open-access procurement of power and provides for transmission infrastructure to ensure reliable electricity supply.Responding to questions on the large amounts of electricity and water required by data centres, Modhwadia said Gujarat was a power-surplus state and that govt had decided to promote the use of desalinated water, which would subsequently be recycled.Dholera has been identified as a major data centre hub, with projects there eligible for an additional 2.5% capital subsidy. Govt is also planning a broader digital infrastructure ecosystem around proposed submarine cable landing stations at Chorwad or Diu, Porbandar, Surat and Dholera.Modhwadia said India currently stores only a small share of data it generates despite accounting for about 20% of global data creation, making rapid expansion of domestic data centre infrastructure important as AI adoption accelerates.Govt claims the sector could create thousands of direct and indirect jobs and could also trigger “reverse migration” by creating opportunities for Indian technology professionals currently working abroad.
