Singapore, for years remained the hub for data-centre businesses as much as global banking, trade and finance activities that connected APAC with the rest of the world. But for the local industry things went south starting in 2019. Singapore presents itself as a compelling case-study to India and the business of data centres.

In the digital age, data is the lifeblood of the global economy. From the emails we send to the videos we stream, every online interaction generates data, and this information is growing at an astonishing rate. According to recent estimates, the world creates over 2.5 quintillion bytes of data every single day. To put that into perspective, it’s equivalent to 2.5 million terabytes or roughly 90 years’ worth of HD video.

With enterprises equating data with oil, the process may have turned redundant with more data and less meaning. The growth in data and the need to analyse it through complex processes has necessitated a growing demand in data centres. India, the world’s largest country by population and also one with the biggest youth could witness an unprecedented surge in consumption of data. Therefore, the need for data storage and processing centres is unprecedented.

The demand is visible not only in domestic avenues such as hosting, analysing, but also with offering compliant services across the world.

Software Engineer Standing Beside Server Racks. (Image Credit: Christina Morillo from Pexels)

Data-residency: Why and Why Not?

In our increasingly interconnected digital world, data has become a currency of its own, and the protection of personal and sensitive information has taken centre stage. To address growing concerns about data privacy and security, governments around the globe have data residency laws. These regulations dictate where data must be stored and processed, aiming to safeguard the rights of individuals and ensure data sovereignty. During the Brexit talks, the most-debated aspect concerning the Brexit phenomenon was not the movement of goods or humans but how software moved between European nations.

One of the key reasons behind the implementation of data residency laws is to ensure that sensitive information, such as financial records, health data, and personal identifiers, remains under the jurisdiction’s legal framework. For instance, the European Union’s General Data Protection Regulation (GDPR) mandates that the personal data of EU residents be stored and processed within the EU, with strict penalties for non-compliance.

India too, took a data sovereignty stance with the RBI asking licensed banks and payment system operators to process data within the country starting with 2018. Union Minister of State Shri Rajeev Chandrashekhar explained more recently that it was never a mandate. Given the way countries around the world have enacted structures around data residency, there is likelihood that India could soon adopt a stringent variant to enforce data residency.

To understand data residency, here’s a look at China and its initiatives in that domain. China’s Cybersecurity Law, enacted in 2017 imposes a stringent requirement that “important data” and “personal information” collected or generated within China must be stored exclusively on servers located within the country. It applies broadly across various sectors, encompassing technology, finance, and healthcare. Additionally, China’s Cybersecurity Law imposes controls on the transfer of data across borders.

It necessitates that companies seeking to transfer data beyond China undergo comprehensive security assessments and secure approval from relevant governmental authorities. China has also introduced its own data protection standards, such as the Personal Information Security Specification (PISS). This framework outlines specific requirements for the collection and processing of personal data and is deemed essential for businesses conducting operations within China.

Image Credit: Benzoix on Freepik


Singapore emerged as a global hub for data centres, attracting tech giants and businesses seeking to capitalise on the region’s strategic location, robust infrastructure, and political stability. However, as the demand for data storage and processing facilities surged, concerns over environmental sustainability and land use prompted Singaporean authorities to impose a moratorium on new data centre developments in early 2021. This temporary halt on approvals for data centre construction reflects Singapore’s commitment to striking a balance between technological advancement and sustainable urban development.

The moratorium was a response to the rapid proliferation of data centres in the city-state, which had been consuming a substantial amount of energy and land resources. Singapore, a country with limited land area and a reputation for being environmentally conscious, recognized the need to reevaluate its approach to data centre expansion. Singapore realised the importance of environmental concerns arising out of data centres’ high energy consumption, which also strained its power grids and contributed to carbon emissions.

Land scarcity was also a critical issue given limited land but substantial footprint of data centres. During the moratorium Singapore identified data and strategies to mitigate climate concerns. The unanimous choice was for more climate conscious data-centres that guzzled less but provided equitable value. Some solutions were reliance on renewable sources such as Hydrogen, Solar-powered DC, and cooling solutions that emitted lesser.

Green Data Center. (Image Credit: Sheetalv from Flickr)


India’s data-centre business is expected to sizzle in the coming few years. A Mordor Intelligence report estimates a growth of 8 percent up to 2026 while Arizton Advisory & Intelligence predicts the size to reach $10 billion by 2027. A more recent Anarock-Binswanger report indicates that by 2025 alone India would add 45 new data centres or 1,015 MW of capacity. The enthusiasm can be further gauged from an ICRA report that predicts an investment of Rs 1.5 lakh crores in the short term in India’ data-centre business.

A 2023 McKinsey report delves into more encouraging trends – a 10% rise in data centre consumption in the United States, a corresponding increase in co-location and investment in data centre facilities, a growing emphasis on sustainable and efficient cooling systems, and investor attention in green data centres. Moreover, deploying sustainable solutions was also tied to opportunities for the local and allied sub-sectors.

Image Credit: Massimo Botturi on Unsplash

In conclusion, the growth of data in our world is nothing short of extraordinary. It’s reshaping industries, fuelling innovation, and impacting our daily lives in profound ways. As we continue to navigate this data-driven era, it’s essential to strike a balance between harnessing the potential of data and safeguarding privacy and security. The world’s data landscape is evolving at an unprecedented pace, and how we adapt to and manage this transformation will shape the future of our global society.

Singapore presents compelling propositions to how crucial data gets stored and analysed. On one end, the Singapore government’s decision to impose a moratorium highlights the need for balance between fostering technological innovation and sustaining growth in a densely populated, resource-limited nation. On the other, India is witnessing a tall demand in areas around IoT, predictive analytics, real-time processing, edge-computing, newer telecom uses, and virtual reality.

In case you missed:

Sairaj Iyer is a Mumbai based financial and business journalist. His articles have appeared in Banking Frontiers, The Dollar Business,, and recently The Economic Times and The Times of India. Besides Technology, he writes on strategies, trends in the BFSI industry, policy-making, and personal finance.

Leave A Reply

© Copyright Sify Technologies Ltd, 1998-2022. All rights reserved