Reliance Industries has acquired a 33.33 per cent stake in a joint venture set up by Brookfield Infrastructure and Digital Realty for developing data centers in India. RIL will invest ₹378 crore to acquire the stake in each of the five special purpose vehicles set up under the joint venture company called Mercury Holdings SG Pte Ltd.

The JV is currently developing data centers in marquee locations in Chennai and Mumbai. The JV’s first 20 megawatt (MW) greenfield data center, on a 100 MW campus in Chennai, is expected to be completed by the end of 2023. The JV recently announced the acquisition of 2.15 acres of land in Mumbai to build a 40 MW data center. RIL will become an equal partner in the JV, and it will be branded as ‘Digital Connexion: A Brookfield, Jio and Digital Realty Company’.

Digital Realty Trust, Inc provides cloud and carrier-neutral data centre, co-location, and interconnection solutions globally with 300-plus data centers across 27 countries. Data centres developed by the JV will leverage Digital Realty’s industry-leading energy-efficient data centre platform design and operating procedures, Brookfield’s in-depth knowledge of the Indian infrastructure market; and Jio’s massive digital ecosystem and very strong enterprise relationships, said a press statement.

Reliance has also committed to invest further amounts in equity and debt securities of the Indian SPVs and any other new SPV that may be set up by Mercury India SG FDI Pte Ltd up to an amount not exceeding ₹622 crore.

Kiran Thomas, CEO, Jio Platforms Limited, said: “We are excited to partner with Digital Realty, one of the most innovative data centre companies globally and with Brookfield, our existing and trusted partner. The partnership will help us serve our enterprise and SMB clients with cutting-edge, plug-and-play solutions delivered from the cloud and lead their digital transformation and make them more competitive and efficient”

Over the last few years, many major companies have either announced new data centre projects in India or diversified to add it as a new business, including Microsoft, Google, LTI, Hiranandani Group’s Yotta Infrastructure, NTT, Blackstone, and Adani Group.

Arpit Agrawal, Managing Director, Head of Infrastructure, India & Middle East, Brookfield, added: “Data Centers provide essential services and critical infrastructure to support the digitalization that is taking place in every aspect of life in India. Together with Reliance and Digital Realty, we look forward to providing the best of solutions to the digital transformation needs of Indian and global corporates.”

India’s ever-growing data consumption has spurred the need to store and process data, which has increased the demand for data centres in the country. With data protection and security becoming the top priority for countries, local storage of data has become increasingly critical. According to a recent report by Avendus Capital,  Indian data centre market has grown by 48 per cent over the last three years from 540 MW in 2019 to over 800 MW of installed capacity in 2022. Currently, developers are addressing a pipeline of over 3,000 MW i.e. 300 MW per annum over the next 10 years, with a capex requirement of $23 billion.

Serene Nah, Managing Director and Head of Asia Pacific, Digital Realty, said: “India is a mostly untapped market for the data center industry driven by the rapid adoption of digital business models, the world’s largest population, and a government that recognizes the role of technology for future economic development. This joint venture brings together three global leaders in digital infrastructure to accelerate Digital India by developing, owning and operating institutional quality carrier-and cloud neutral data centers across India.” 

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