Reliance Industries Chairman Mukesh Ambani is all set to undertake another monumental project by setting up the world’s largest data center in Jamnagar, Gujarat, as reported by Bloomberg. 

This ambitious initiative follows in the footsteps of his father, Dhirubhai Ambani, who constructed the world’s largest oil refinery in the same city over 25 years ago. Jamnagar’s transformation from a hub of fossil fuels to a symbol of deep-tech innovation marks a new chapter in the Ambani legacy.

When Dhirubhai Ambani proposed building the massive oil refinery, skeptics belive that the feasibility of such an endeavor by an Indian company within a tight timeframe. Yet, he defied expectations and achieved that feat. Now, Mukesh Ambani is betting on another groundbreaking project, targeting a data center capacity of 3 gigawatts, which would triple India’s existing capacity. In comparison, the largest data centers today operate below 1 gigawatt.

The Growing Need for Data Centers in India

India’s digital transformation is driving the demand for large-scale data centers. Factors like the rapid growth of e-commerce, stricter local data storage regulations, and increasing adoption of artificial intelligence (AI) have intensified this need. Emerging technologies like Generative AI require immense computing power, and Ambani’s data center will play a crucial role in supporting India’s AI ambitions.

Reliance’s Shift Toward Deep-Tech Innovation

Mukesh Ambani has been steering Reliance Industries toward a deep-tech focus. Over a decade ago, he disrupted the telecom market with Jio, offering affordable data, famously stating that “data is the new oil.” Now, the planned Jamnagar data center, located alongside the oil refinery, symbolizes Reliance’s evolution from a traditional industrial giant into a forward-thinking tech enterprise.

At Reliance’s 47th AGM, Ambani emphasized embedding advanced technologies into every aspect of the company’s operations. Reliance is already utilizing AI tools to enhance its businesses. For instance, its beauty brand Tira leverages AI to provide personalized experiences, like a “fragrance finder” that suggests perfumes based on customer preferences or a “skin analyzer” that recommends skincare products through facial analysis.

Rising Competition in the Data Center Sector

Reliance isn’t the only player aiming to dominate the data center market. AdaniConneX, a joint venture between Adani Enterprises and EdgeConneX, has raised $213 million to fund projects in Noida and Chennai. The company plans to become one of the top three data center operators in India by 2030, with expansion plans in the UAE, Singapore, Nepal, and Thailand.

The data center industry in India is expected to attract over USD100 billion in investments by 2027, according to CBRE, with the adoption of AI, cloud computing, and IoT driving demand. Between 2019 and 2024, the sector saw over $60 billion in investments from domestic and global players.

Why Ambani’s Data Center Matters

The Jamnagar data center is expected to cost between USD20 billion and USD30 billion, aligning with global efforts to strengthen AI infrastructure. For example, the US recently announced a private sector investment of USD500 billion in AI-related infrastructure to maintain a competitive edge.

India’s data center demand continues to rise due to its digital transformation initiatives, with sectors like BFSI, IT, and e-commerce increasingly relying on robust data center solutions. Commerce Minister Piyush Goyal has stated that India has the potential to become the world’s top destination for data centers, given its reliable green power, skilled workforce, and strong interconnectivity.

Expanding India’s Data Center Capacity

In addition to Reliance’s Jamnagar project, India’s data center capacity is projected to more than double to 2-2.3 gigawatts by 2026-27, driven by investments in cloud storage and the penetration of Generative AI, according to Crisil Ratings. Global firms such as Colt Data Centre Services, CapitaLand Investment, and tech giants like Google, Amazon, and Microsoft are also expanding their data center operations in India to capitalize on this fast-growing market.