On September 9, 2024, ST Telemedia Global Data Centres (STT GDC) announced a substantial investment of US$3.2 billion to expand its data centre capacity in India by 550 megawatts (MW). This expansion is projected to nearly triple STT GDC's IT load over the next five to six years, reflecting the company's confidence in India's rapidly growing digital economy. STT GDC's president, Bruno Lopez, highlighted the significance of this expansion during the company's 10th anniversary, noting that India's digital economy is expanding at a rate almost three times that of the overall GDP, with a target of achieving a US$1 trillion digital economy by 2027-2028. Currently, STT GDC operates 28 data centres across 10 cities in India, with a total capacity exceeding 318 MW, and is majority-owned by STT GDC in partnership with Tata Communications Ltd. [22e6c13b]
This investment aligns with a broader trend of increasing demand for digital infrastructure in India, driven by factors such as cloud computing and artificial intelligence (AI) adoption. The expansion is part of a larger strategy to bolster the digital economy, which is crucial for attracting global investments. In a similar vein, Malaysia has also recognized the importance of data centres, with Minister of Digital Gobind Singh Deo reporting a 23% year-on-year increase in approved investments, reaching RM329.5 billion in 2023. The digital economy in Malaysia contributed approximately 23% to the nation's GDP from 2021 to 2023, with aspirations to increase this contribution to 25.5% by 2025. Notably, Google has invested US$2 billion in a data centre in Shah Alam, Malaysia, which is expected to support around 26,500 jobs and generate an economic impact of RM15.04 billion. [22e6c13b]
However, the rapid growth of data centres has raised concerns regarding their environmental impact and sustainability. Critics argue that while these facilities can attract global investments, they must be evaluated for their resource consumption. Minister Gobind advocates for a balanced approach, emphasizing the need for sustainable practices in the data centre industry. This sentiment is echoed globally, as seen in Ireland, where the government is working to balance the energy requirements of data centres with sustainable development goals. [22e6c13b]
As both Malaysia and India continue to develop their digital economies, the focus on data centres will remain a crucial aspect of their strategies to attract investments and enhance economic resilience. Collaboration between government, industry, and stakeholders will be essential in navigating the challenges and opportunities presented by this rapidly evolving sector.