Extracting the Gains: Why India Must Negotiate Harder in the Data Center Boom

The report does three things. It maps the market and policy drivers of the boom, including domestic demand, the GCC ecosystem, infrastructure status for data centers above 5 MW, a twenty-year tax holiday for foreign hyperscalers exporting their services, state-level incentive packages, and a dense maze of data localization rules. It then conducts a cost-benefit analysis that questions the dominant claims of technological sovereignty and broad economic gain. Finally, it argues that India must shift from investment facilitation to negotiated extraction, and lays out the concrete templates the government can put on the table: compute for academia, applied R&D testbeds, regional tech clusters, AI-based public service delivery, and a structured renewables and storage push.