The country’s artificial intelligence (AI) market is projected to more than triple to $17 billion by 2027, positioning it among the fastest-growing globally, according to PL Capital. The brokerage in its latest report said that the growth is driven by rising enterprise tech investments, a strong digital ecosystem, and a deep talent pool.
India has over 600,000 AI professionals, expected to scale to 1.25mn by 2027, accounting for 16% of global AI talent second only to the US. AI-led data centre demand in India is being driven by a combination of strong end-user adoption and increasing policy support for domestic capability creation.
With AI adoption is expanding rapidly across the world, the computational intensity of AI workloads is reshaping the energy profile of data centers, resulting in higher RTC electricity demand and new challenges for power infrastructure, PL Capital said.
AI workloads are far more power intensive than traditional computing:
It further said that AI-driven data centres rely on GPU-based architectures and high-density server clusters, which materially increase electricity consumption compared to conventional workloads. Rack power density has increased 3–5x, with AI racks typically requiring 25-40 kW vs 5-15 kW for traditional workloads.
This shift is driving higher overall power demand, need for advanced cooling systems and larger substations and stronger grid connectivity.
Growth of Data Centres in India
India’s data centre capacity is set to triple to 4.5 GW by FY30, driven by cloud adoption, digitalisation, AI and favourable government polices-creating a large, 24/7 source of incremental power demand.
At present, India ($0.08/kWh) and China ($0.08/kWh) have the least electricity across major countries. It is followed by USA ($0.18/kWh), Singapore ($0.25/kWh), Japan ($0.22/kWh) and Germany ($0.37/kWh).
At present, India accounts for nearly 20% of global data consumption but hosts less than 5% of the world’s data centers, underscoring a headroom for expansion.
