Andhra Pradesh Government Approves Record-Breaking Land Allocation for Adani Google data centre Investment
India: The Andhra Pradesh government officially approved 480 acres of land allocation in Visakhapatnam and Anakapalli districts on December 2, 2024, marking a historic moment for India’s technology infrastructure development. This decision positions the state as a central hub for artificial intelligence and cloud computing services.
The project involves a massive ₹87,500 crore investment commitment that will receive ₹22,000 crore in state incentives over several years. The scope of this undertaking demonstrates India’s commitment to becoming a global leader in AI-powered digital infrastructure.
Breaking Down the Adani Google data centre Partnership Structure
The land allocation involves multiple key players working in strategic coordination. Adani Infra (India) Private Limited serves as the “notified partner” of Raiden Infotech India, which operates as Google’s subsidiary company. This partnership structure allows Google to leverage Adani’s local expertise while maintaining operational control over the facility.
The government order specifically states that the data centre will be built to the same standards as those supporting Google’s core services, including Search, YouTube, and Workspace. These exacting requirements ensure that the Adani Google data centre will meet global performance benchmarks.
APIIC identified three distinct land parcels that will be transferred to Adani Infra as the primary notified partner, pending survey completion and possession transfer. This systematic approach ensures smooth project implementation while maintaining regulatory compliance.
Investment Scale Reflects India’s Growing AI Market Dominance
India’s digital infrastructure is positioned for unprecedented growth, with investment commitments in the data center industry expected to exceed $100 billion by 2027. The Adani Google data centre project represents a significant portion of this broader investment wave.
India’s total data center capacity reached approximately 1,255 MW between January and September 2024 and is projected to expand to around 1,600 MW by year-end. The 1 GW capacity planned for the Visakhapatnam facility would substantially increase the nation’s computational capabilities.
India’s AI-optimized data center market is expected to reach $1.19 billion in 2025 and grow at a CAGR of 21.08% to reach $3.10 billion by 2030. This explosive growth trajectory underscores the strategic importance of the Andhra govt land for Adani Google initiative.
Industry experts project that India will add 795 MW of new capacity by 2027, bringing total capacity to 1,825 MW. The Adani Google data centre project alone would contribute significantly to achieving these ambitious targets.
Strategic Location Advantages in Visakhapatnam
Visakhapatnam offers compelling advantages for the AI data centre in Visakhapatnam development. The coastal location provides excellent connectivity options for international submarine cables. Additionally, the region benefits from relatively stable power infrastructure and favorable government policies.
Data center development costs in India average just $7 per watt, among the lowest globally, while electricity costs are 20% lower than in the United States. These economic advantages make the Adani Google investment in Vizag particularly attractive from a cost perspective.
India has transitioned from power-deficient to power-sufficient status, reaching a total installed capacity of 452.69 GW by October 2024, with essentially zero power deficit. This power availability is crucial for supporting energy-intensive data center operations.
The geographic positioning also addresses latency concerns. East-to-west or north-to-south coverage across India can take 30-45 milliseconds, and AI applications might lose effectiveness if latency increases to a second. Visakhapatnam’s central location helps minimize these delays.
Government Incentive Package Attracts Major Investment
The Andhra Pradesh government is providing a 25% discount on market price for the 480 acres, along with stamp duty waivers, 25% discount on industrial water supply, electricity duty exemption, and one-rupee discount on industrial electricity tariff. These comprehensive incentives demonstrate the state’s commitment to attracting technology investment.
The most significant concession involves 100% reimbursement of State GST during the construction phase. This substantial benefit reduces upfront capital requirements and accelerates project development timelines.
With industrial electricity tariffs ranging from ₹5-7 per unit, the one-rupee discount represents a 15-20% cost reduction that will continue for 15 years for electricity and 10 years for water. These long-term incentives provide predictable operational cost structures.
The incentive structure compares favorably with other states’ offerings. An Andhra Pradesh government official noted that these incentives are not dramatically different from industrial subsidies typically offered by states like Karnataka, suggesting competitive but not excessive terms.
Technical Specifications and Infrastructure Requirements
The planned 1 GW facility in Visakhapatnam is expected to consume electricity equivalent to nearly 50% of Mumbai’s annual consumption. This massive energy requirement highlights the scale of computational power being deployed.
Modern AI workloads demand specialized infrastructure capabilities. High-performance computing is increasing power density requirements, making advanced cooling solutions like liquid and immersion cooling critical for maintaining efficiency. The Adani Google data centre will need to incorporate these advanced technologies.
Facility design is shifting toward 50-120 kW racks, liquid cooling, and on-site renewables, moving competition from generic colocation toward purpose-built hyperscale campuses. This technological evolution requires substantial upfront investment but delivers superior performance capabilities.
Market Context and Competitive Landscape
India’s data center market was valued at $5.03 billion in 2024 and is projected to reach $12.85 billion by 2033, exhibiting a CAGR of 10.43%. The Adani Group Google Cloud deal represents a significant portion of this expanding market.
AWS, Microsoft, and Google have together pledged more than $15 billion for new capacity around Mumbai, Chennai, and Hyderabad. The Visakhapatnam investment adds another major hub to this growing network of facilities.
The market saw 114 MW of increased supply in the second half of 2024, with absorption rising to 122 MW, driven by Cloud Service Providers planning for new AI demand. This supply-demand balance indicates healthy market conditions for new capacity additions.
India’s hyperscale AI data center market is experiencing rapid growth, with the country’s data center capacity exceeding 1 GW in 2024, representing nearly a threefold increase over four years. This expansion is driven by cloud computing, AI, IoT, and digital transformation initiatives.
Regional Development and Employment Impact
The Adani Google data centre project promises substantial regional economic benefits. The development will create a powerful engine for economic growth in Visakhapatnam, Andhra Pradesh, and the entire nation by driving digital inclusivity and creating tens of thousands of jobs in technology, construction, and clean energy.
This represents India’s largest AI data center campus development in partnership between Adani Enterprises through AdaniConneX and Google. The scale positions Visakhapatnam as a major technology destination.
The facility will establish Visakhapatnam as an AI and connectivity hub serving not only India but the rest of the world, complementing existing cable landing stations in Chennai and Mumbai. This global connectivity enhances the region’s strategic importance.
Sustainability and Environmental Considerations
The project builds on both companies’ commitment to sustainability, involving co-investment in new transmission lines, clean energy generation, and innovative energy storage systems that will support the data center’s operations while enhancing India’s electricity grid resilience and capacity.
Google has pledged to work with local partners to deliver new transmission lines, clean energy generation, and energy storage systems in Andhra Pradesh. These commitments address environmental concerns associated with large-scale data center operations.
Modern data centers face significant energy challenges. Data centers are highly energy-intensive, with cooling systems consuming nearly 40% of energy. The Adani Google data centre will need innovative solutions to minimize environmental impact while maintaining operational efficiency.
Government Policy Support and Digital India Mission
The Indian government approved approximately $1.24 billion investment for the IndiaAI Mission in March 2024, with 44% allocated to developing compute capacity exceeding 10,000 GPUs over five years. This national initiative supports projects like the Adani Google data centre.
India’s IT Minister Ashwini Vaishnaw stated that this digital infrastructure will help meet India AI mission goals, emphasizing the need to re-skill IT professionals and develop youth for AI services. The Visakhapatnam facility will contribute to these broader educational and economic objectives.
The Digital India Program aims to enhance digital infrastructure and promote digital inclusion, significantly increasing demand for scalable data center infrastructure nationwide through accelerated cloud adoption and e-governance.
Future Expansion and Scalability Plans
The initial 480-acre allocation may represent just the beginning of larger development plans. Earlier in 2022, the previous YSRCP government had allotted 130 acres to Adani Group for a 200MW data center, and now the TDP government is allocating another 480 acres for the Google data center partnership.
Another 550 MW data center by Sify Technologies was recently approved in Vizag, indicating that the region is becoming a major data center hub beyond just the Adani Google project.
Nearly 475 MW of new capacity is currently under construction across several Indian cities, suggesting that the industry pipeline remains robust and the Visakhapatnam development fits within broader expansion trends.
The Andhra govt allots 480 acres for Adani-Google AI data Centre in Visakhapatnam decision represents more than just a land transaction. It signals India’s emergence as a global AI superpower and demonstrates how strategic partnerships between international technology companies and Indian infrastructure groups can accelerate digital transformation. As the facility moves from approval to construction and eventual operation, it will serve as a model for future technology investments across the nation.
This landmark development positions Visakhapatnam alongside major global technology hubs while contributing to India’s ambitious goals of becoming a leader in artificial intelligence and digital infrastructure. The success of this project will likely influence similar investments across the country, further cementing India’s position in the global digital economy.
Frequently Asked Questions
What is the total investment for the Adani Google data centre in Visakhapatnam?
The project involves a massive ₹87,500 crore investment commitment, with the state government providing ₹22,000 crore in incentives over several years.
How much land has Andhra Pradesh allocated for the Adani Google data centre?
The Andhra Pradesh government has allocated 480 acres of land in Visakhapatnam and Anakapalli districts for the AI data center project.
What is the capacity of the planned Adani Google data centre?
The facility will have a 1 GW (1,000 MW) capacity, making it one of India’s largest AI data center campuses.
Which companies are involved in the Visakhapatnam data center project?
The project involves Adani Infra (India) Private Limited as the notified partner of Raiden Infotech India, which is Google’s subsidiary company.
What government incentives is Andhra Pradesh providing for this project?
The state is offering a 25% land discount, stamp duty waivers, 25% water supply discount, electricity duty exemption, and 100% State GST reimbursement during construction.
When was the land allocation approved for the Adani Google data centre?
The Andhra Pradesh council of ministers approved the land allocation on November 28, 2024, with the official order issued on December 2, 2024.
How will this project impact job creation in Andhra Pradesh?
The development will create tens of thousands of jobs in technology, construction, and clean energy sectors, driving economic growth in Visakhapatnam and across Andhra Pradesh.
