New Delhi, Jun 16 (IANS): Delhi-NCR is expected to emerge as a new data centre hotspot as demand from government departments and IT and IT-enabled services (ITeS) are expected to drive further growth, as per JLL report.

Titled '2020 India Data Center Market Update', the report said that the data centre capacity of Delhi-NCR is likely to grow by 2.2 times to 89 MW by 2023. Around 49 MW capacity addition is expected during 2021-23.

"NCR-Delhi data centers are expected to tend to the increasing demand arising from various digital transformation initiatives by the government. This coupled with supportive state policies for the industry is likely to drive 49 MW supply during 2021-23," said Manish Aggarwal, Managing Director - North & East, JLL India.

Large cloud players are expected to take up capacities to meet the increasing demand, Aggarwal said.

Rachit Mohan, Head-Data Center Advisory (India), JLL said that India's colocation data centre industry witnessed unprecedented absorption of 102 MW during 2020, notching higher absorption than most key markets of Europe and America.

"Fuelled by longer-term trends of rising cloud adoption, increasing digitalisation and progressive legislation, we anticipate increased demand for colocation space nationwide. Rising demand led data center operators and developers to pursue ambitious expansion plans, while some adopted the acquisition route to enter Indian markets, which we expect to continue," he said.

Colo capacity grew by around 28 per cent to reach 447 MW in 2020 from 350 MW in 2019, Mohan added.

The JLL report noted that as the data centre landscape continues to evolve, the industry is expected to grow exponentially to reach 1,007 MW by 2023 from its existing capacity of 447 MW. With the growing reliance on digital connectivity, demand is likely to ramp up further due to the imminent rollout of 5G, IoT-linked devices, data localisation and cloud adoption.

Further, India's data centre sector will require an investment of $3.7 billion over the next three years to fulfill the 6 million square feet greenfield development opportunity for the industry, it said.