The government of India’s draft National Data Centre Policy proposes tax exemptions of up to 20 years for data centre developers to stimulate investment and drive large-scale infrastructure development. The policy links incentives to targets on capacity expansion, energy efficiency, and employment generation. It also extends input tax credits (ITC) on goods and services tax (GST) for capital assets such as construction, heating, ventilation and air conditioning (HVAC) systems, and information technology (IT) equipment, thereby lowering capital costs for investors.
Further, the initiative seeks to harmonise disparate state-level data centre regimes under a national framework, introducing single-window clearances and dedicated economic zones across metros and smaller cities. Infrastructure-status recognition is provided to the industry, enabling better access to power and skilled labour, alongside land subsidies and reforms in power procurement as added incentives. Standardised building codes and capacity-building programmes form part of the policy’s broader infrastructure reforms.