Telangana Plans 1,500-Acre Dedicated Data Center City to Boost Digital Infrastructure
July 1, 2026
Telangana Plans 1,500-Acre Dedicated Data Center City to Boost Digital Infrastructure
The southern Indian state of Telangana is moving forward with plans to establish its first dedicated data center city, a sprawling 1,500-acre development in Aloor village, Chevella mandal. Located approximately 55 kilometers from Hyderabad—a leading hub for colocation and hyperscale facilities—the project signals the state's ambition to become a cornerstone of India's digital infrastructure economy.
In June, Telangana Chief Minister A. Revanth Reddy directed state officials to prepare a detailed report assessing water, electricity, and connectivity requirements for the proposed city, the location of which has already been finalized, according to The Times of India. The initiative is part of a broader push that includes signed Memorandums of Understanding for an estimated 11 GW of data center capacity across the state. Among these are an MoU with UPC-Volt to build a 100 MW AI data center at Bharat Future City in Hyderabad, and another with NTT Data and Neysa Networks to establish an AI data center cluster in the city.
Recognizing the strain such facilities place on utilities, the state government is also launching a project to supply treated waste water to industrial hubs. Implemented through a public-private partnership, the plan includes two pipelines delivering treated water to data centers in Chandanvelly and Bharat Future City. By creating an enabling environment, Telangana is encouraging long-term market growth; according to Mordor Intelligence, the Hyderabad data center market is expected to grow from 859 MW of installed IT load in 2025 to an estimated 4,640.8 MW by 2032.
This week, Chief Minister Reddy met with Bharti Enterprises Chairman Sunil Bharti Mittal to discuss expediting the Chandanvelly Data Centre Project and exploring the establishment of a data center and AI infrastructure campus in the state. Reddy also urged Airtel to expand its digital, cloud, cybersecurity, and artificial intelligence operations in Hyderabad. Mittal praised the Telangana government's forward-looking policy decisions, noting that Bharti Enterprises is committed to expanding its data center capacity and fiber connectivity in the state—a signal to other investors that the region is worth backing.
The prospect of a dedicated data center city could be key to attracting more operators and infrastructure providers to other parts of Telangana. The road to that city remains long and dependent on government support, particularly regarding water, power, and land provisions, but if successful, the state could become a vital node in India's rapidly growing digital infrastructure landscape.
Source: w.media
