Singapore's Digital Edge to invest $2bn to set up its first India data centre

Singapore-based data centre platform firm Digital Edge has announced an investment of $2 billion to set up its first data centre project in India. The company has partnered with Indian sovereign wealth fund, National Investment and Infrastructure Fund (NIIF) and a sustainable-focused real assets manager AGP DC InvestCo,. to develop a pan-India portfolio of hyperscale data centres.

The partnership’s first project is a greenfield 300 mega-watt (MW) hyperscale facility in Navi Mumbai, offering easy access to infrastructure, including power and fibre connectivity. 

The company said that the construction of the 47-acre site will commence in early 2023 and the facility will be built in multiple phases and will be one of the largest data centres in India. The company also said that all its facilities will operate under the brand name Digital Edge DC, without divulging any further details.

Currently, the company provides data centre and fibre services across Asia and is already present in China, Indonesia, Japan, Korea, and the Philippines. Across these five countries, the company already operates 16 data centres with a total IT load capacity of 210 MW. 

Samuel Lee, Chief Executive Officer at Digital Edge said that the partnership with NIIF and AGP marks Digital Edge’s entry into the Indian market, growing its platform to six countries across Asia. Lee added that NIIF and AGP will “bring solid local know-how to our data centre expertise, making a strong combination when it comes to executing the project at speed and to international standards.” 

NIIF will leverage its local and operational expertise in developing platforms as well as its strong infrastructure investment experience, and AGP will bring on-the-ground real estate development and construction experience, drawing on its renewable energy development capabilities. 

The initiative is backed by Stonepeak, a global alternative investment firm specialising in infrastructure and real assets. “We believe that this is an opportune time for Digital Edge to enter the market in Navi Mumbai. Critical data centre infrastructure has a long runway for growth in the country as India’s digital economy continues to rapidly expand,” Andrew Thomas, Senior Managing Director at Stonepeak, said. 

Data centres in India have already emerged as one of the most attractive growth opportunities for global investors and developers. Investments are flowing into the data centre segment. The Indian data centre industry is expected to add 681 MW capacity by the end of 2024 leading to a doubling of capacity to 1,318 MW that will need 7.8 million square feet of real estate space. Mumbai is expected to account for 57% of the new supply followed by Chennai at 25%, according to a report published by commercial real estate services company JLL India on September 27, 2022. 

Global majors like Google, Microsoft and Amazon have already started setting up their hyperscale data centres in India. Other technology companies like Cisco, NTT Data, Equinix, Yotta Trellix, Web Werks and Vultre, among others, have set up their data centre operations in the country in the last one year. 

In December 2022, Singapore-based data centre provider Princeton Digital Group (PDG) also launched its first data centre MU1 in Navi Mumbai with an at an investment of $300 million over six acres of land. The facilities provide 48MW of IT capacity across two buildings and is Indian Green Building Council Platinum (IGBC Platinum) certified.

The country’s data centre demand is expected to significantly increase, driven by rapidly growing data consumption, the digitisation of the economy, the onset of 5G and data localisation trends, said the JLL report.