Gujarat unveils Data Centre Policy to be a leading hyperscale AI hub

Gujarat unveiled its new Data Centre Policy, aiming to become India's top hyperscale AI data centre hub. The policy offers competitive incentives to attract ₹6 lakh crore in investments and build 7.5 GW of data centre capacity.

The Government of Gujarat on Thursday unveiled its Data Centre Policy, a landmark initiative aimed at transforming the state into India's leading hyperscale AI data centre destination. The policy sets out a clear vision to build a scalable, secure, and sustainable digital infrastructure ecosystem that anchors the nation's digital economy and attracts global cloud providers.

According to a press release from the Gujarat Chief Minister's office, the Gujarat Data Centre Policy is designed to establish the state as a globally competitive hub for hyperscale and colocation data centres while promoting sustainable, energy-efficient facilities that leverage Gujarat's leadership in renewable energy and round-the-clock power solutions. It seeks to attract hyperscalers and cloud service providers through competitive incentives, fast-tracked approvals, and hyperscale-ready governance, while simultaneously strengthening data security, digital resilience, and technological self-reliance.

Policy Aims and Ambitious Targets

The policy also aims to enable innovation across cloud, artificial intelligence, high-performance computing, and digital services by fostering collaboration between industry, academia, startups, and technology providers. In addition, it emphasises the creation of high-value jobs and clear skill-development pathways, building an advanced digital workforce in cloud engineering, cybersecurity, and emerging technologies. The policy sets an ambitious target to position Gujarat as a premier destination for hyperscale and colocation data centres by attracting both global and domestic operators. It aims to achieve 7.5 GW of data centre capacity, thereby making Gujarat a key pillar of India's national data centre growth strategy. To realise this vision, the state will build a hyperscale-ready ecosystem through proactive policy support, investor-friendly governance, and fast-tracked approvals that catalyze long term digital infrastructure development, the press release said.

Comprehensive Incentives and Governance

To accelerate investment and ensure competitiveness, the Gujarat Data Centre Policy offers a comprehensive package of fiscal and non-fiscal incentives. These include a capital subsidy of 2.5% on eligible fixed capital investment in the Dholera region, claimable within ten years, and an interest subsidy of up to 4% on term loans for ten years, capped at Rs 25 crore annually. Long-term operational savings are ensured through a Rs 1 per unit power tariff subsidy for twenty years, alongside 100% exemptions on stamp duty and registration fees for land transactions, and full reimbursement of electricity duty for twenty years.

The policy further provides SGST reimbursements on plant and machinery, building infrastructure, and eligible services for up to twenty years, reducing the tax burden and encouraging reinvestment. To facilitate hyperscale-ready infrastructure, special building norms allow relaxations in FSI, parking, ground coverage, and technical provisions. Sustainability is supported through capital assistance for captive desalination plants, while non-fiscal benefits include dual power feeders, open access permissions, and facilitation for distribution licenses. The press release further stated that, additionally, approvals are streamlined through a single-window clearance system via the Investor Facilitation Portal and DST Incentive Management Portal, ensuring ease of doing business and faster project execution. All projects availing incentives must source at least 51% of electricity from renewable energy, reinforcing Gujarat's commitment to green growth. Incentives are capped at 75% of eligible fixed capital investment, disbursed over 20 years, ensuring balanced and sustainable support.

The policy offers a comprehensive package of fiscal incentives, including capital subsidy, interest subsidy, power tariff subsidy, SGST reimbursement, electricity duty reimbursement, support for desalination plants and stamp duty exemptions. It also provides non-fiscal incentives such as fast-track approvals, additional floor space index (FSI), relaxations in building norms, open access to power, assured electricity supply and water availability to accelerate project execution.

Investment Outlook and Infrastructure Boost

"Gujarat is the first state to bring this policy. We are confident it will attract investments of ₹6 lakh crore, create 7.5 GW of data centre capacity and generate significant employment," Chief Secretary M K Das said in Gandhinagar, where Chief Minister Bhupendra Patel unveiled the policy.

The state is also strengthening the digital infrastructure required to support large-scale investments. P Bharati, Secretary, Department of Science and Technology, said Gujarat will soon have two operational cable landing stations, with another project expected to be announced shortly, significantly enhancing international connectivity and making the state more attractive for global cloud and data centre operators, the press release said.

The National and Global Context

"Globally, there are around 12,000 data centres, with the United States and China accounting for nearly 70% of the world's capacity. India, despite generating nearly 20% of the world's data, has only about 3% of global data centre capacity. This represents a tremendous opportunity," the official added. (ANI)

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