Funding for India’s data centres from foreign investors stood at $738 million in H1 2026

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Foreign investors have poured in an impressive $1.56 billion into India’s data centre and digital infrastructure ecosystem in the first half of 2026, betting on rising demand for cloud services and artificial intelligence (AI), as well as India’s growth trajectory as a digital infrastructure market.Funding for India’s data centres from foreign investors stood at $738 million in H1 2026, nearly seven times the $111 million invested across the entire digital infrastructure ecosystem during the first half of 2025, according to Tracxn data.According to Rajiv Ranjan, Associate Research Director - Cloud, Data Centre at IDC, foreign investors are encouraged in their decision to invest in India’s data centres primarily due to the growing demand for cloud and AI workloads.“Outside of Amazon and Google, there will be dedicated data centres for banking and AI startups looking to train their models. Investors are anticipating strong demand and therefore want to invest. We expect that by 2028-2030 around 30-40 per cent AI deployments will take place outside the public cloud,” said Ranjan.Further, India’s data centre expansion is outpacing growth in several Southeast Asian markets, including Malaysia, Singapore, Indonesia and Thailand. AI spending is expected to grow at a CAGR of 39 per cent from 2025-2030 while public cloud spending is projected to expand at a CAGR of 23 per cent during the same period, added Ranjan.Long-term capital seeks scaleNxtra alone raised nearly $710 million funds in 2026 from private equity firms Carlyle Group, Alpha Wave Global and Anchorage Capital Partners. CtrlS secured an addition $28 million. Despite the presence of several viable data centre operators, investors have gravitated towards companies that offer greater clarity around scale, growth narratives, customer adjacency and monetisation strategies, factors that encourage private capital investment by foreign players, according to Greyhound Research.“Nxtra’s attraction (for global investors) stems from Airtel’s telecom backbone, fibre reach, enterprise relationships, network adjacency, and the potential to connect data centre capacity with sovereign cloud, edge infrastructure, and telco-grade service delivery. The participation of global investors alongside Airtel also matters because it allows strategic control to remain with the parent while bringing in long-term expansion capital,” said Sanchit Vir Gogia, Chief Analyst and Founder at Greyhound Research.Similarly, CtrlS gives investors exposure to a specialist data centre operator with an established footprint, enterprise credibility, and a hyperscale expansion story.Additionally, the vote of confidence shown by hyperscalers has strengthened investors sentiment. This year alone, AirTrunk announced a $30 billion investment commitment, while Amazon outlined plans to invest an additional $13 billion in India’s digital infrastructure capacity. Even US-based consulting firm Evolution Cloud Services’ (EVOCS) invested ₹100 crore through its Indian arm, Velloe, in late June 2025.Risks remainDespite the optimism, any slowdown in AI demand or geopolitical developments, including tariff-related uncertainties, could pose risks to investor returns, said Ranjan. Further, while India has adequate energy availability, the country’s transmission infrastructure must expand in tandem with data centre growth to ensure a smooth ramp-up in demand.“History will not judge this wave by the number of billions announced, but by how many of those billions translate into powered capacity and AI-ready infrastructure that becomes useful to Indian enterprises and citizens — beyond hyperscalers, landlords and balance sheets,” said Gogia.Published on July 13, 2026