Gujarat launches data centre policy, aims to become hub for ‘hyperscalers’

The Gujarat government on Thursday launched its data centre policy that aims to transform the state into India’s leading “hyperscale AI data centre destination”. It aims to achieve 7.5 GW of data centre capacity, officials said.

“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,” the officials said.

It seeks to attract hyperscalers, which are massive cloud service providers, through competitive incentives and fast‑tracked approvals, while simultaneously strengthening data security, digital resilience, and technological self‑reliance.

The policy also aims to enable innovation in cloud, artificial intelligence, high‑performance computing, and digital services by fostering collaboration between industry, academia, startups, and technology providers.

“Gujarat is the first state to bring this policy. We are confident it will attract investments of Rs 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 launched the policy.

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.

To realise the vision, the state will build a hyperscale-ready ecosystem through proactive policy support, investor-friendly governance, and fast-tracked approvals that catalyse long term digital infrastructure development.

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The state is also strengthening the digital infrastructure required to support large-scale investments. P Bharathi, Secretary, Department of Science and Technology, said Gujarat will soon have two operational cable landing stations (CLS), 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.

“Globally, there are around 12,000 data centres, with the United States and China accounting for nearly 70 per cent of the world’s capacity. India, despite generating nearly 20 per cent of the world’s data, has only about 3 per cent of global data centre capacity. This represents a tremendous opportunity,” she further added.

Incentives

To accelerate investment and ensure competitiveness, the policy offers a comprehensive package of fiscal and non-fiscal incentives.

The fiscal incentives include 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.

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These include a capital subsidy of 2.5 per cent on eligible fixed capital investment in the Dholera region, claimable within ten years, and an interest subsidy of up to 4 per cent 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 20 years, alongside 100 per cent 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 20 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.

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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.

However, all projects availing incentives must source at least 51 per cent of electricity from renewable energy. Incentives are capped at 75 per cent of eligible fixed capital investment, disbursed over 20 years, ensuring balanced and sustainable support.