Gujarat's New Data Centre Policy: Targeting Rs 6 Lakh Crore Investment and Green Energy Push
The Gujarat government has announced the Viksit Gujarat Data Center Policy for 2026-29, with an ambitious target of attracting investments worth Rs 6 lakh crore and creating 7.5 gigawatts (GW) of data centre capacity. Officials claim this would be the highest capacity in the country.
This policy offers a range of incentives for investors, including complete exemption from stamp duty and registration fees for land leasing or purchase, 100% reimbursement of electricity duty for 20 years, and a subsidy of Re 1 per unit of power consumed for 20 years. Additionally, it provides relaxations in Floor Space Index (FSI), parking norms, and ground coverage, along with financial assistance for captive desalination plants to meet high water requirements.
The policy follows Reliance Industries Ltd's announcement of a partnership with Meta to lease an AI-enabled data centre in Jamnagar, Gujarat. Under that deal, Reliance will build and operate a 168 MW data centre powered by renewable energy and using desalinated water for cooling.
Gujarat is not the first state to announce a data centre policy. Telangana led the way in 2016, followed by Tamil Nadu, Uttar Pradesh, West Bengal, Odisha, Maharashtra, Haryana, and Andhra Pradesh. However, Gujarat claims its policy is among the most ambitious, with a strong emphasis on green energy. Data centre entities must ensure at least 51% of their electricity consumption comes from renewable sources.
This green push aligns with broader industry trends. Google has announced plans for an AI data centre campus in Andhra Pradesh powered entirely by clean energy. The Adani Group, through its AdaniConneX joint venture, is developing a 5 GW data centre platform across India, powered by its renewable energy park in Kutch.
P Bharathi, Secretary of Gujarat's Department of Science and Technology, stated: 'Gujarat is the first state to announce the largest capacity data center as well as the first to have a dedicated policy in the country specifically designed for green AI data centres.' He added that other states work on a case-to-case basis, whereas Gujarat has a dedicated policy.
The Gujarat Electronics and Software Industries Association (GESIA) has praised the policy as one of the 'strongest policy frameworks currently available in India, particularly for very large hyperscale investments above 150 MW.'
To attract investments to the Dholera region, 100 km southwest of Ahmedabad, the government offers an additional capital subsidy of 2.5% on eligible fixed capital investment, exclusively for that area. The subsidy can be claimed within 10 years of receiving in-principle approval.
The policy reflects Gujarat's strategy to position itself as a hub for data centres, leveraging its renewable energy resources and infrastructure. It aims to boost the state's economy while promoting sustainable development.
