Capital Economics analyst Shilan Shah says rapid expansion of Indian data
centers could materially affect the macro outlook. While much debate on AI
focuses on services disruption, AI still requires significant physical
infrastructure. Announced data‑center investment for 2026–30 is roughly 0.5% of
annual GDP; if this spurs upgrades to India’s power grid and water systems the
macro impact could be substantially larger. Rising demand for domestic
electronics and precision engineering capacity would also support India moving
up the manufacturing value chain.
