India Doubles Down on AI with 75% of Businesses Localizing Data: Report Data localization is growing in India as businesses balance local compliance with high-performance infrastructure. Companies are storing data closer to users and operations to ensure faster access and meet regional regulations.

India is doubling down on artificial intelligence (AI) with 75 per cent of businesses aligning their data location strategy with AI to keep the data close to users, according to the latest findings from Global Data Insights Survey by one of Digital Connexion's parent companies Digital Realty.

AI is becoming increasingly important for businesses in India, seeking to automate processes, drive innovation, and remain competitive. Organizations are actively preparing for an AI-driven future by integrating data as a critical enabler of their strategies.

Indian businesses are shaping their AI journeys around three core priorities: data localization, sustainability, and structured data strategies. The survey reveals that 75 per cent of businesses are reshaping their infrastructure and site strategies with data at the helm. This underscores India's emergence as a digital hub in the Asia-Pacific region, where 59 per cent of companies already have a formal data strategy in place—well ahead of several global benchmarks.

Data localization is growing in India as businesses balance local compliance with high-performance infrastructure. Companies are storing data closer to users and operations to ensure faster access and meet regional regulations.

Sustainability is now a priority for businesses in India, involved in shaping their IT infrastructure. Companies are focusing on energy-efficient data centers and reducing consumption to meet environmental goals and strengthen their green credentials.

60 per cent state that sustainability goals are the most important factor impacting their AI strategy.
51 per cent of Indian businesses measure success in IT sustainability through green credentials, reflecting a commitment to sustainable practices.

Key highlights from India:

• 44% believe AI and machine learning are essential to unlocking data's full potential.
• 75% are using data to inform infrastructure and location strategies—reshaping digital foundations.
• 60% say sustainability is the most critical factor shaping their AI strategy.
• 51% measure IT success through green credentials—underscoring a shift toward responsible tech adoption.
• 77% have embraced distributed data models to balance compliance and performance.

However, challenges remain. Nearly 52 per cent of organizations report struggling to extract actionable insights due to fragmented data, and 51 per cent say insufficient investment in data systems is impeding progress toward AI maturity.

As the AI era unfolds, India's digital transformation story is being written in data—structured, localized, sustainable, and strategically aligned.

Sovereignty and data localisation are also driving a lot of the growth for data center providers in India. Riding that wave, L&T Cloudfiniti, the data center arm of Larsen & Toubro, plans to scale its data center capacity to 90 MW by the end of next year across three cities – Mhape and Panvel (Maharashtra), and Whitefield (Bengaluru). It has a current capacity of 30 MW across two data centers in Mumbai and Chennai.

"Sovereignty and data localisation is driving the growth as sovereign hosting has now become extremely important for the country…We are an AI data center. That's our sweet spot. 80 per cent of our capacity is built to cater to AI," said Seema Ambastha, CEO of L&T Cloudfiniti.