The power problem behind India’s AI ambitions

As India tries to play catch-up with the rest of the world in AI development, the country now finds itself behind in two categories: data centers and power.

It’s already witnessing a surge in data center investments, driven by digital adoption and government incentives such as tax holidays for foreign cloud providers until 2047.

But there’s a catch: Data centers don’t just need land and connectivity; they require megawatts of uninterrupted power.

In India, 1 gigawatt can power roughly 700,000 to 1 million homes, depending on the state. This means the extra demand from data centers alone could equal the electricity needs of several large cities.

The country currently hosts around 20% of global data but has only about 3% of its data center capacity.

Inside modern data centers, power requirements have changed dramatically over the past decade, explains Rahul Takkallapally, co-founder of cloud infrastructure startup Bharath Cloud.

He says a typical server rack once required about 3 kilovolt-amps of electricity. That later doubled to around 6 kilovolt-amps as computing power increased.

Now racks built for AI workloads, such as Nvidia H-100 chips, can require between 40 kilovolt-amps and 100 kilovolt-amps, according to Takkallapally. The additional electricity also contributes to the heating of the chips, which then require cooling.

“The machines are getting denser and hotter,” he adds. “Now you are talking about liquid cooling and completely different power requirements.”

The nuclear answer

India’s solution to the predicament is becoming clear: nuclear power, with private players taking on a bigger role. The country has begun opening its tightly controlled nuclear sector to private participation, allowing companies to build and operate reactors for the first time.

“The surge in power demand from AI is one of the key reasons the nuclear sector is opening up now,” says Takkallapally, who is also a member of the Confederation of Indian Industry.

Putting an N in data centers

Echoes from space

Promises and perils