India's data centre expansion to create 4.33 lakh jobs, drive residential demand

India's proposed data centre pipeline of approximately 9,030 MW has the potential to generate nearly 4.33 lakh ecosystem jobs, translating into an estimated 195 million square feet (sq ft) of residential space demand by 2030, according to proptech company Square Yards.

Unlike traditional commercial developments, data centres create value by attracting investments in power infrastructure, fibre connectivity, logistics, commercial establishments and supporting services, gradually transforming surrounding regions into thriving urban ecosystems.

While data centres are often viewed purely as digital infrastructure assets, the report reveals that their long-term impact extends well beyond technology, acting as catalysts for housing demand, infrastructure investment and urban expansion across emerging growth corridors.

India currently generates nearly 20% of the world's digital data but accounts for only 4% of global data centre capacity, indicating substantial headroom for infrastructure expansion. With artificial intelligence, cloud computing and enterprise digitisation accelerating investments, India's installed data centre capacity is expected to grow significantly over the coming years, bringing with it a new wave of infrastructure-led real estate development.

"For decades, India's real estate growth has been shaped by highways, industrial corridors, airports and IT parks. Data centres represent the next evolution of that story. While these facilities themselves employ relatively few people, they attract the critical infrastructure that enables long-term urban development," said Vivek Agarwal, Co-Founder and Chief Technology Officer, Square Yards.

The report notes that the strongest residential impact is unlikely to emerge within the data centre campuses themselves. Instead, it identifies a 5-15 km 'Golden Ring' surrounding major facilities where infrastructure upgrades, mixed-use developments, residential townships, retail centres and civic amenities are expected to flourish. As these supporting ecosystems mature, they create sustained housing demand driven by ancillary employment and economic activity rather than direct workforce concentration.

"Investments in power, fibre connectivity and logistics create confidence for businesses, developers and institutions, eventually driving residential and commercial growth around these emerging digital corridors," Agarwal said.

Among the major beneficiaries, Maharashtra is projected to generate over 54 million sq ft of residential demand, followed by Karnataka with nearly 28 million sq ft, Andhra Pradesh with over 23 million sq ft, Uttar Pradesh with approximately 22.7 million sq ft, Telangana with 21.6 million sq ft and Tamil Nadu with 19.4 million sq ft. These markets are expected to witness increasing residential activity as digital infrastructure investments accelerate alongside improvements in transport, utilities and commercial ecosystems.

While stating that India's next real estate growth cycle may be shaped increasingly by digital infrastructure, the report concludes that emerging destinations, including Visakhapatnam, Noida, GIFT City (Gujarat International Finance Tec-City) and other infrastructure-rich locations, are expected to benefit from sustained economic activity, improved connectivity and long-term institutional investment.

"Housing demand continuously chases areas that offer huge employment potential. This growth will not be restricted to mega cities only. We expect Tier-2 and Tier-3 cities to benefit from this grand opportunity equally," said Sunita Mishra, Vice President – Research & Insights, Square Yards.