Nxtra Data, the data centre arm of Bharti Airtel, has announced an ambitious investment plan of ₹4,500–6,000 crore over the next three to four years to cement its leadership in India’s rapidly expanding data centre market. This strategic move aims to double the company’s capacity from its current 80–100 megawatts (MW) to over 400 MW, positioning Nxtra as a frontrunner in supporting India’s digital transformation. With a robust network of 14 large data centres and over 120 edge data centres across 65 cities, Nxtra is set to capitalize on the surging demand for digital infrastructure driven by cloud computing, 5G, artificial intelligence (AI), and data localization policies. This article delves into the details of Nxtra’s investment strategy, its competitive positioning, and the broader implications for India’s data centre industry.
Nxtra’s Investment Strategy
Doubling Capacity to 400 MW
Nxtra’s ₹6,000 crore war chest is designed to significantly scale its infrastructure. The company plans to add 70–80 MW of capacity over the next three to four years, effectively doubling its current operational capacity of 80–100 MW. According to senior industry executives, this expansion will involve constructing new hyperscale data centres in key metro areas such as Mumbai, Chennai, Hyderabad, and Kolkata, while also enhancing its edge data centre network to support low-latency applications. The investment will be funded through a combination of internal accruals, equity infusion, and debt, with no constraints on capital allocation as Nxtra aims for a 30–35% market share in India’s data centre sector.
In its 2024–25 annual report, Nxtra outlined a ₹5,000 crore plan to achieve a 400 MW capacity, a target initially set for 2025 but now extended to 2027 due to the scale of new projects. This includes a flagship 200 MW hyperscale data centre in Hyderabad, set on a 40-acre plot, expected to be operational within two years and reach full capacity in five years. Additionally, a 25 MW facility in Kolkata’s Bengal Silicon Valley, with a ₹600 crore investment, is slated to become operational by March 2026, serving eastern India and SAARC countries.
AI-Driven Operational Excellence
Nxtra has pioneered the integration of artificial intelligence (AI) in its data centres, becoming the first in India to deploy AI-powered solutions for operational efficiency. The SmartSense platform from Ecolibrium, initially implemented at its Chennai data centre, uses real-time analytics for predictive maintenance, energy optimization, and streamlined operations. This deployment has yielded a 10% increase in asset life, a 10% reduction in non-IT power consumption, a 15% improvement in equipment performance, and a 25% boost in productivity. Nxtra plans to extend this AI technology across all its core data centres, reinforcing its commitment to intelligent, future-ready infrastructure.
Sustainability and Net-Zero Commitment
Sustainability is a cornerstone of Nxtra’s expansion strategy. The company has committed to achieving net-zero emissions by 2031 through renewable energy adoption, energy-efficient infrastructure, and sustainable practices. Currently, 70% of its data centres’ electricity is sourced from renewable energy via partnerships with ten joint ventures in green energy projects. Nxtra has also signed power-wheeling agreements with Ampln and Amplus Energy to procure 140,208 MWh of renewable energy annually and has partnered with Bloom Energy to deploy hydrogen-ready fuel cell technology at its Karnataka data centre. These initiatives align with Nxtra’s pledge to the RE100 global renewable energy initiative, making it a leader in environmentally friendly digital infrastructure in India.
Competitive Landscape
India’s data centre market is highly competitive yet fragmented, with global players like NTT, ST Telemedia, and Indian firms such as CtrlS, Sify Technologies, and Yotta Data Services vying for market share. Nxtra, with its current capacity of over 200 MW, holds the largest data centre network in India, serving 450 customers, including enterprises, hyperscalers, startups, SMEs, and government bodies.
The market is poised for significant growth, with capacity expected to rise from 1.2 gigawatts (GW) in 2025 to 4.5 GW by 2030, attracting $20–25 billion in investments. Mumbai leads with 41% of total capacity, followed by Chennai (23%) and Delhi-NCR (14%), while emerging hubs like Hyderabad and Kolkata are gaining traction due to favorable state policies and infrastructure support. Nxtra’s strategic focus on these key markets, coupled with its parent company Airtel’s enterprise subscriber base and telecom infrastructure, provides a competitive edge.
Other major players are also scaling up. AdaniConneX has a $4 billion investment plan to capture a 25% market share, while Brookfield-RIL’s Digital Connexion and Hiranandani’s Yotta are expanding aggressively. Global hyperscalers like Microsoft, Google, and AWS are driving demand, with Microsoft reportedly investing $2 billion in a Hyderabad campus and Google planning a $6 billion data centre in Visakhapatnam. Despite this competition, Nxtra’s AI integration, renewable energy focus, and extensive edge network position it to meet the growing needs of cloud service providers, fintech, OTT platforms, and AI-driven workloads.
Market Drivers and Opportunities
Surging Data Demand
India’s data centre industry is experiencing exponential growth due to increased data consumption, widespread digital adoption, and the rollout of 5G networks. The country generates 20% of global data but accounts for only 3% of global data centre capacity, underscoring significant untapped potential. Enterprises are shifting from captive data centres to colocation and cloud services, while hyperscalers require large-scale facilities to support AI workloads, which demand 5–10 times higher power density than traditional workloads. Nxtra’s campuses are designed to handle these requirements, incorporating liquid cooling and high-capacity power infrastructure.
Government Support
The Indian government’s Digital India initiative and data localization mandates have created a favorable environment for data centre growth. The sector’s infrastructure status, granted in the 2022 Union Budget, enables access to long-term funding at lower costs, facilitating rapid expansion. State governments, particularly in Maharashtra, Tamil Nadu, Telangana, and West Bengal, are rolling out data centre policies, offering incentives like land subsidies and power reliability. Nxtra’s CEO, Ashish Arora, emphasized the need for government intervention to streamline land approvals, power allocation, and single-window clearances to fast-track growth.
Global Connectivity
India’s strategic location and access to submarine cable landing stations enhance its appeal as a regional data centre hub. Nxtra’s Chennai facility is integrated with Airtel’s global submarine cable network, providing secure connectivity for hyperscalers. The upcoming 85 MW Mumbai data centre will serve as a landing station for SEA-ME-WE-6 and 2Africa Pearl cables, further strengthening Nxtra’s global connectivity offerings.
Economic and Social Impact
Nxtra’s ₹6,000 crore investment is expected to create significant economic benefits, including thousands of direct and indirect jobs in construction, operations, and related industries. The expansion will also drive innovation by supporting India’s digital economy, enabling compliance with data localization regulations, and attracting global technological investments. By enhancing reliability, scalability, and security, Nxtra aims to empower enterprises, fintech companies, and OTT platforms, contributing to India’s vision of becoming a global digital powerhouse.
The focus on sustainability will also have long-term environmental benefits. By prioritizing renewable energy and energy-efficient technologies, Nxtra is setting a benchmark for green data centres in India, aligning with global efforts to combat climate change. The company’s net-zero commitment by 2031 reflects a forward-thinking approach to balancing growth with environmental responsibility.
Challenges and Risks
Despite its ambitious plans, Nxtra faces several challenges:
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High Capital Costs: Data centre construction costs have risen to ₹60–70 crore per MW, driven by land, power, and equipment expenses. Nxtra’s ability to manage costs while maintaining quality will be critical.
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Regulatory Hurdles: Streamlining land approvals and state-level regulations remains a bottleneck. Arora has called for data centres to be recognized as a separate asset class with simplified approval processes.
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Power Constraints: AI-driven workloads require significantly higher power density, straining existing infrastructure. Nxtra’s investments in liquid cooling and renewable energy aim to address this, but reliable power supply remains a concern.
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Competition: The influx of global and domestic players intensifies competition, requiring Nxtra to differentiate through innovation, sustainability, and customer-centric solutions.
Future Outlook
Nxtra’s ₹6,000 crore investment positions it to play a pivotal role in India’s data centre boom. By doubling its capacity to 400 MW, leveraging AI for operational excellence, and prioritizing sustainability, Nxtra is well-equipped to meet the evolving demands of India’s digital economy. The company’s strategic expansion in Hyderabad, Kolkata, and other key markets, combined with its integration with Airtel’s telecom infrastructure, ensures a strong foundation for growth.
As India’s data centre capacity is projected to quadruple by 2030, Nxtra’s proactive investments will help bridge the gap between data generation and storage capacity. The company’s focus on green energy and AI-driven efficiency aligns with global trends, making it an attractive partner for hyperscalers and enterprises alike. With government support and a competitive edge in connectivity, Nxtra is poised to lead India’s transformation into a regional data centre hub, driving economic growth, innovation, and sustainability.
