Princeton Digital seeks easier approval formalities

Data centre services provider, Princeton Digital Group (PDG), which recently announced an investment of ₹2,500 crore in setting up data centres in India, wants approval formalities made easier.

A data centre is a facility created with uninterrupted power, cooling and broadband fiber, with redundancies built in, so that customers may bring their servers there and run them. As such, a data centre provider would need a number of approvals, such as from real estate authorities and utilities, to begin their operations.

‘Growing demand’
In a chat with businessline, PDG’s General Manager, Vipin Shirsat, said it would be a big help if the government made approval processes easier to get for companies like PDG to set up data centres in India, for which there is a growing demand. In this context, he noted that the Centre is working on a data centre policy, for which a few rounds of discussion have taken place with the industry.

Today, the Indian data centre industry is governed by the policies of the respective State governments. Shirsat said Uttar Pradesh has a “very progressive policy”, and Maharashtra and Tamil Nadu are working on their own regulations.

India has a clutch of players such as Amazon Web Services, Google Cloud, Azure (of Microsoft), Digital Ocean and Domain Racer, with a total current operating capacity of 650 MW. (Capacity in data centres once used to be measured by the size of the real estate, in square meters or feet, and later in terms of number of server racks. But neither was appropriate with technological advancements in servers. Then the industry moved to measuring capacity in terms of power consumption.)

According to the 2020 Draft Data Center Policy of the Ministry of Electronics and IT (Meity), India’s need for data centres opens up an investment opportunity of the order of $4.9 billion by 2025. It (then) noted that India had 375 MW of data centre capacity, which “may grow three times by 2025.” But India’s data centre capacity has already doubled in two years since the draft policy came out.

The draft policy spoke of ease of doing business, enabling a favorable ecosystem for data centers and setting up of ‘data centre economic zones’.

PDG’s customers
Princeton Digital Group, which has incorporated a company in India, is in the process of building data centres of the capacity of 48 MW in Mumbai, for starters, in two equally divided phases. At present, 4 MW of capacity is ready for use and another 10 MW will be, in a couple of months, Shirsat said. As for customers, he said conversations were on with some for a capacity of 10 MW, but added that there was no problem in getting customers, thanks to the digitalisation of the Indian economy.

Any company that may not have space on its own premises, or may not like to invest in on-premise infrastructure for its server banks, is a potential customer for PDG. These are ‘enterprise customers’. But the bigger, or ‘hyperscale’ customers are those such as banks and e-commerce companies.

PDG is also concurrently looking at putting up data centres in Pune, Delhi, Chennai and Hyderabad. These would be outside of the investment program of $300 million. Answering a question, Shirsat said the margins in the industry were in the region of 30-35 per cent. The Hindu BusinessLine