Adani to build India’s first integrated data centre and tech biz park in AP

Billionaire Gautam Adani-led Adani Group is developing an integrated data centre and technology business park in Vizag, to boost the local technology ecosystem in the region, the conglomerate said in a press release on Thursday.

AdaniConneX, a 50:50 joint venture between Adani Group and EdgeConneX, will host a 300 MW data center capacity facility, which will be powered with up to 100% renewable energy. It will also be connected with terrestrial and submarine infrastructure to help the deployment of cloud and emerging technologies in the region.

The integrated facility will be one of the largest hyperscale data centres in India and will also house a skill development center, as per the release.

“The project, which will have a data center, technology and business park, and skill development center, will generate jobs for local communities and open new gateways of growth in the region, connecting Vizag to the APAC (Asia-Pacific) IT ecosystem,” the Adani Group said in the release.

“The investments will be on top of the ₹20,000 crore already invested in the state, which created more than 18,000 direct and 54,000 indirect jobs,” it added.

The Adani Group’s investments in Andhra Pradesh span multiple sectors, including ports, logistics, and renewable energy. The group operates two of the state’s largest private ports at Krishnapatnam and Gangavaram and is also committed to developing 15,000 MW of renewable power projects and 10 million tonnes per annum of cement manufacturing capacity in the state, the release noted.

The groundbreaking ceremony at the park site in Vizag was held on May 3, 2023 in the presence of Chief Minister of Andhra Pradesh Y S Jagan Mohan Reddy, Managing Director of the Adani Group, Rajesh Adani, and CEO and Whole Time Director of Adani Ports & SEZ (APSEZ) Limited, Karan Adani.

"Our world is being defined by our ability to generate, store, access and move data," said Gautam Adani, Chairman, Adani Group.

"With the advancements in AI, high-definition content and massive digitisation, the need for compute and storage is increasing exponentially. Andhra Pradesh, with its geographical advantages of land for renewable energy and a long coastline, is well positioned to host data center parks not only for our country but also for those nations that are short of land or energy," he added.

“The establishment of 300 MW data centers by the Adani Group will facilitate the laying of a submarine cable from Singapore and help change the future dynamics of broadband services,” said Y S Jagan Mohan Reddy, CM, AP. “The technology park will propel Vizag into a tier-1 city which will also deploy renewable sources of energy to power it up.”

After infrastructure, defence, realty and FMCG, the ports-to-energy conglomerate forayed into the digital infrastructure space by forming a JV with US-based EdgeConneX. The company is eyeing hyperscale data centres in six Indian cities -- Chennai, Navi Mumbai, Noida-Delhi, Vizag, and Hyderabad. Last year, the group had incorporated a new data centre subsidiary in Mumbai, which was established by AdaniConnex Pvt. Ltd., a joint venture of the company with EdgeConnex Europe BV.

In India, the demand for hyperscale data centres has shot up in the past few years as more businesses are moving their IT infrastructure to the cloud, especially driven by increasing demand for app-based services and OTT platforms. The Covid-19 pandemic has further accelerated the shift to the digital medium, benefitting the data centre industry.

According to India Ratings and Research (Ind-Ra), the country’s data centre industry will attract investment plans of ₹70,000 crore to ₹72,000 crore over the next five to 10 years. “These ambitious investments will mainly be driven by new, large corporate groups (around 40%) and cloud service providers (around 30%).”

The demand outlook for new data centre capacities is also strong, backed by the rising data usage by retail customers (both on wireless and wireline segment), a robust outlook for enterprise users, and the emergence of cloud service providers (CSPs), the report said.