Make India Competitive Again

There’s one company that exemplifies the current moment in India’s AI investments. It doesn’t make advanced semiconductors or train large language models. Instead, it rents out space to companies that do.The arrangement is called colocation—think of it as real estate for servers, where clients plug in their machines while the “landlord” provides power, cooling, and connectivity.Sify Infinit Spaces, the data-centre arm of Sify Technologies, is India’s poster child for this setup. It will be behind the country’s first IPO for a company of its kind.By tracking the colocation industry’s growth around the world, there’s incredible promise based on demand. Capacity worldwide has more than doubled since 2019 to hit 42 gigawatts (GW) in 2024, and could reach 65 GW by 2027. Sify should head the same way, if not grow even faster.But that assumes India has enough power to support rapid scaling. One Nvidia GB300 rack can draw enough electricity to power 100 homes in the US, and it takes thousands of racks to train a foundational model. Even Sify acknowledges the problem in its DRHP by referring to power supply risk, grid reliability risk, and related issues.Sumit Chakraborty, The Ken’s head of desk, looks into Sify Infinit Spaces’ IPO and the company’s promise in this edition of Make India Competitive Again, as read by Rahel Philipose.*Read this edition as a newsletter: https://the-ken.com/newsletter/make-india-competitive-again/indias-first-data-centre-ipo-shows-what-to-fix-before-india-can-scale-ai/Download our app and subscribe to The Ken to listen to all our podcasts: iOS: https://apps.apple.com/in/app/the-ken/id1282944688 Android: https://play.google.com/store/apps/details?id=com.ken.core&hl=en&gl=US&pli=1 Check out Make India Competitive Again on Apple Podcasts: https://podcasts.apple.com/us/podcast/make-india-competitive-again-premium/id1810672381 Or Spotify:https://open.spotify.com/show/5yxzxRmN7idKJen5QdezPl

India is relaxing rules for states to approve and fund standalone battery-storage systems. There’s a rush to build those projects, and tariffs are going lower and lower.Rajasthan set a “lowest tariff” record last week at Rs 1.77 lakh per megawatt per month, undercutting Andhra Pradesh. Maharashtra is now sending out feelers, so there may be an even lower figure soon.It’s a situation that has played out in renewable energy before. Solar and wind projects were rapidly installed, but little was done to build local manufacturing muscle. The current rush of activity in the battery-storage space is only leading to market distortion. With government funding and other incentives, it’s “almost a risk-free business”, as one executive told The Ken.There’s also the matter of relying heavily on Chinese imports, which also happened when solar and wind energy projects were being built. The result is an insecure supply chain for battery storage in India. The Ken editor Seema Singh has the details in the latest edition of Make India Competitive Again, as read by Brady Ng.*Read this edition as a newsletter: https://the-ken.com/newsletter/make-india-competitive-again/states-confuse-cheap-with-sustainable-in-battery-storage-gold-rush/

The audio edition of The Ken’s Make India Competitive Again newsletter, spearheaded by Seetharaman G. Every Wednesday, our editors and reporters read the latest edition and chronicle what India is doing, will do, and should do—to not just survive but thrive in the chaos unleashed by Donald Trump.