US tech giant Microsoft and the Telangana government have finalized a deal to set up a Rs 15,000 crore data center in Hyderabad. A 50-acre plot near the town has reportedly been finalized and the project is expected to create around 300 jobs.
According to sources familiar with the development, an official announcement should be made within a month. Microsoft has not commented on the Business Standard questions.
Telangana is one of the few states to adopt a data center policy in India, back in 2016. It also expects investments of around $10 billion in the segment over the next five years.
At the end of 2020, Amazon Web Services (AWS) had announced plans to establish its second data center region in the country in Telangana for an investment of $2.77 billion. Flipkart and CtlS also offer similar facilities in the state.
Last year, Microsoft said it planned to build about 50 to 100 new data centers each year for the foreseeable future. At present, it operates around 200 data centers around the world. Microsoft India had set up a research and development (R&D) center in Hyderabad in 1998. It is one of the company’s largest R&D centers other than its Redmund headquarters.
The company had also tied up with Reliance Jio in 2019 for a long-term alliance to set up cloud data centers in India.
According to a report by JLL, of India’s current data center capacity of 499 megawatts (Mw), around 45% is based in the financial capital Mumbai. It is followed by Chennai, Pune and Bangalore with 12% each, Delhi around 8%, Hyderabad around 7% and Kolkata around 1%.
Telangana tries to close this gap with its aggressive sops aimed at investors in the segment. In addition to rapid clearances and availability of land in key locations, the state was also ready to offer cloud business to those setting up their centers in Telangana.
Despite being the youngest state in the country, Telangana has attracted $33 billion in investments over the past seven years. Through a one-stop shop called TSiPASS which was introduced in 2014, the state has so far authorized about 17,500 investment proposals. These helped it rise from 13th place in the Center’s Doing Business Index ranking in 2015 to third place in 2019.
Earlier this week, Telangana signed an agreement with the Fédération Internationale de l’Automobile (FIA) for Formula E, the governing body of events like Formula 1, to make Hyderabad a host city for Formula E, a car race for electric vehicles.
Hyderabad has thus entered the elite league of cities like Beijing, Buenos Aires, Miami, Berlin, Moscow, Paris and Hong Kong as the venue for the event.
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