India's NITI Aayog releases a framework to help states assess AI-driven data-centre investments

NITI Aayog's Frontier Tech Hub released a Data Centre Evaluation Framework on 14 October to help India's state governments plan, evaluate and facilitate data-centre investments, according to a government release posted on 15 October. The release says India's data-centre capacity has grown from about 375 MW in 2020 to approximately 1.5 GW, driven by demand for AI, cloud computing, high-performance computing and data-intensive applications. Developed with input from industry, the Ministry of Electronics and IT (MeitY), the Ministry of Power and DPIIT, the framework has five pillars: power and energy; water and cooling; siting and environmental sustainability; economic and strategic value; and policy, governance and implementation. Recommendations include assessing grid readiness and net grid draw, promoting renewable and storage-backed power, evaluating basin-level water stress, identifying data-centre zones, distinguishing colocation from active compute services, and linking state incentives to measurable outcomes. The release describes the framework as a decision-support tool for state governments; NITI Aayog's CEO said it would help states make informed decisions and support faster, more predictable project execution without creating an additional layer of regulation.

What it means for business: no new legal obligations; data-centre developers and cloud and AI providers planning capacity in India may find states using the framework to judge proposals and attach conditions on power, water and local value to incentives.