Data localization fuels growth to Indian data center industry

Data is the new oil of every country and requires increased security protocols.

Data: A New Wealth of the Country

In today’s digitally connected world, data has become an important asset of every organization and nation. The use of the internet has exponentially increased in the last decade, exposing individuals to thousands of benefits of a connected world, starting from making communication faster to accessing services easier. We are creating the data every single time we open and use an application or log in to a website or even buy something from online markets. This implies companies have crucial information about each of us.

Increase in Data Requires Increased Protection Standards 

As more and more individuals go online, more and more information is turned digital. And currently, the data generated is stored outside the country at the company’s data centers. For example, the most popular social networking website – Facebook has a huge user base in India. All the data generated with the Facebook by Indian users is stored on servers outside India. This data contains our usage history, browsing data, a sketch of our internet behavior, preference data, facial recognition tools and more – all collected on a daily, hourly and per minute basis. Not just Facebook, most of the top technology MNCs store our business critical information on data centers outside India. Therefore, one cannot assure if our data is safe and secured as it is no longer restricted to our geographical boundaries. 

Data Localization: An Increased Data Safeguarding Protocol

After the continuous and detailed analysis of the above scenario, the economists and other security experts from the government as well as various industries came up with the concept of Data Localization – an act of storing data on any device that is physically present within the borders of a specific country where the data was generated.  It mandates that organizations collecting critical data about customers must store and process them within the borders of the country. 

Data Localization Mandate fuels to Data Center Business in India

With the concept of Data localization, India would require better IT infrastructure such as sophisticated data centers to store and process customer-centric data. This boosts the data center market in India and enables to create innovative solutions for data centers to increase the capacity and at the same time secure the information stored in that particular data center. 

The primary drivers of the data center industry in India would be the availability of abundant real estate and competitive policies, along with ICT-capable human resources, and market factors such as the continuing growth in India’s mobile market and internet penetration.

A report by Cushman and Wakefield has indicated that digital data in India was around 40,000 petabytes in 2010 and is likely to shoot up to 2.3 million petabytes by 2020 — twice as fast as the global rate. If India houses all this data, it will become the second-largest investor in the data center market and the fifth-largest data center market by 2050. 

Many nations, especially from South East Asia, are now looking towards India as the most preferred destination for data center outsourcing. If the Data Nationalism bill is passed by the Indian government, majority of the business – both overseas and local those are hosting data outside the country will need to comply and host the data in India – generating a large amount of business in Indian data center industry.

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Data Localization data center Data Nationalism bill


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