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India’s data centre ecosystem could attract $23 billion in investments over the next five years due to rising AI adoption and increasing cloud demand, according to Avendus Capital. The report said rapid deployment of GPUs and expansion of data centre capacity will drive growth, with Mumbai expected to emerge as the country’s biggest data centre hub

The data centre ecosystem is set to boom as artificial intelligence (AI) drives technological advancement. India is expected to be a major beneficiary of this trend.

India’s data centre ecosystem may create a $23 billion investment opportunity over the next five years due to rising AI adoption, which is expected to drive the deployment of 650,000-700,000 GPUs in the country, said Avendus Capital, an investment bank.

Graphics processing units (GPUs) are the building blocks of data centres that process data at high speed to support AI capabilities.

India’s data centre capacity is expected to grow at a compound annual growth rate of over 26 percent in the next five years, the investment bank said in a report on data centres.