Gujarat Data Centre Policy 2026–29: Significance, Features & Challenges
Source: Indian Express
GS III: Science & Technology, Infrastructure- Energy
Overview
- News in Brief
- Key Features
- Significance
- Challenges
Why in the News?
The Gujarat Government has launched the Viksit Gujarat Data Centre Policy (2026–29) to create a supportive policy framework for large-scale investments in the data centre sector.
News in Brief
- The policy aims to position Gujarat as a leading hub for hyperscale data centres, which are essential for cloud computing, artificial intelligence and large-scale digital services.
- It promotes the development of AI-ready digital infrastructure to support emerging technologies, data-driven services and India’s expanding digital economy.
- The policy also encourages green energy-powered data centres, thereby seeking to balance rapid digital infrastructure growth with energy efficiency and environmental sustainability.
Key Features
- Build a 7.5 GW digital capacity and attract ₹6 lakh crore in investments in data centers.
- Promotion of AI-ready hyperscale data centres.
- Minimum 51% of electricity consumption to come from renewable energy sources.
- Focus on Dholera as a major data centre hub.
Financial Incentives
- Capital subsidy for eligible investments.
- Exemption from stamp duty and registration fees.
- Electricity duty reimbursement.
- Power tariff subsidy of Rupees 1 per unit of 20 years.
- Support for desalination plants to meet water requirements.
- Reimbursement for eligible infrastructure and machinery expenses.
- A data centre is a facility that stores, processes, and manages digital data using servers and networking infrastructure.
- Hyperscale data centres support cloud computing, AI, and large-scale internet services.
- Renewable energy integration reduces the carbon footprint of data centres.
Significance
- Strengthens cloud computing, AI, fintech, e-commerce and digital public infrastructure by expanding data storage and processing capacity.
- Encourages large domestic and foreign investments while generating high-skilled employment in IT, electronics and allied sectors.
- The focus on renewable energy-powered data centres can help reduce the environmental footprint of the rapidly expanding digital economy.
- Enhances domestic data storage, improves cybersecurity, and reduces dependence on overseas digital infrastructure.
Challenges
- Data centres require large amounts of electricity, increasing pressure on power infrastructure and raising carbon emissions if renewable energy adoption remains limited.
- Cooling systems consume significant quantities of water, creating challenges for sustainable water management, especially in water-stressed regions.
- The growing volume of sensitive data stored in data centres increases risks related to cyberattacks, data breaches and unauthorised access.
- Data centres require substantial capital investment, advanced technology and specialised professionals in areas such as AI, cloud computing and cybersecurity.
Government Initiatives Related to Data Centres
- Digital India Programme
- IndiaAI Mission
- National Data Governance Framework Policy
- Semiconductor Mission
- Green Energy Corridor Programme
Conclusion
Gujarat’s Data Centre Policy can serve as a model for combining digital infrastructure expansion, AI growth and renewable energy adoption, helping the state emerge as a sustainable data centre hub while strengthening India’s digital economy.
Key Takeaways
UPSC Prelims and Mains Practice Question
With reference to the Gujarat Data Centre Policy (2026–29), consider the following statements:
- The policy aims to create 7.5 GW of data centre capacity.
- It mandates that at least 51% of the electricity consumed by data centres should come from renewable energy sources.
- The policy identifies Dholera as a major hub for attracting hyperscale data centres.
- The policy was the first data centre policy introduced by any Indian state.
Which of the statements given above are correct?
A. 1, 2 and 3 only
B. 2 and 4 only
C. 1, 3 and 4 only
D. 1, 2, 3 and 4
Answer: A
Explanation: Statement 4 – Incorrect: Telangana was the first Indian state to announce a data centre policy (2016); Gujarat’s policy is notable for its strong focus on green, AI-ready data centres.
Mains Practice Question
Q. Discuss the role of data centre policies in strengthening India’s digital economy, AI ecosystem, and energy transition. Examine the challenges associated with sustainable data centre development.( 250 Words)
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