On March 11, Bharatiya Janata Party MLA and BJP Yuva Morcha president Dheeraj Muniraju urged the Congress-led Karnataka government to establish dedicated data center parks in Bengaluru and its surrounding areas.
He cited reports that a Google data center project had moved to Visakhapatnam in Andhra Pradesh instead of Bengaluru.
Responding to this, Karnataka IT and Biotechnology Minister Priyank Kharge said that the Andhra Pradesh government had offered substantial subsidies for the project and emphasized that Karnataka would pursue a more sustainable approach. "Data centers are important, but there are better ways to do it," he said.
During the Question and Answer session in the Assembly, Muniraju stated that Bengaluru, widely known as the IT capital, lacked dedicated parks for colocation and enterprise data centers.
"Bengaluru is known as the IT capital of the world. The IT boom is shifting to the northern part of the city. However, this cannot be said when it comes to data centers. The government has not allocated dedicated data center parks. Because of this, companies are forced to rely on private players and are facing several issues," he said.
Muniraju pointed out that major companies were moving to other cities. "The largest number of data centers are in Mumbai, while Chennai is in second place, and Delhi is in fourth place. Bengaluru has slipped to the fifth place. Whether it is social media, streaming platforms, AI systems, or cloud computing, Bengaluru is number one in all these sectors. For all this, large data centers are required," he said.
He proposed establishing a major data center park in Doddaballapur, north of Bengaluru, where large tracts of land have already been acquired for the Quin City project. "Major companies such as Amazon, Microsoft, Google, Oracle, and Alibaba have their headquarters in Bengaluru. They should also have their data centers here. Hence, one data center park should be allocated in Doddaballapur," he said.
Muniraju also highlighted developments in other cities. "Hyderabad is similar to Bengaluru, and several data centers have come up there. According to media reports, Google's data center project has gone to Visakhapatnam. A $13-billion investment involving three Amazon projects has gone to Hyderabad, with those facilities set up on the outskirts of the city. Hence, efforts should be made to accommodate data centers in Doddaballapur," he said.
Kharge responded to this concern by stating that the project in Visakhapatnam had received significant support.
"Everyone talks about Google moving to Visakhapatnam, but no one discusses the cost of doing so. The Andhra Pradesh government has provided a subsidy of Rs 22,000 crore for the Google project. The land subsidy is 25 percent. They have offered a Re 1 reduction in power tariff per unit for 15 years, a 10 percent GST exemption for 10 years, 100 percent stamp duty exemption, and a 10 percent capital subsidy on plant and machinery. The number of jobs being generated is only about 1,500," he said.
Kharge also emphasized the significant resource requirements of data centers.
"Data centers are extremely power-sensitive. For a one-megawatt plant, we require around Rs 70 crore. In one acre of land, only a one-megawatt plant can be set up. We also need about 25 million litres of water per megawatt every year to run a data center," he said.
"If one asks five questions on ChatGPT, about 500 ml of water is consumed. That is the scale of consumption. Now, with new technology, companies are using liquid cooling and treated water. That is why we will re-evaluate our policy and come up with a sustainable data center policy," he added.
According to the minister, 32 data centers are currently operating privately in Karnataka.
"We already have a Data Center Policy and we are reviewing it. It is necessary to have data centers for AI, machine learning, and other emerging technologies. But data centers are also major consumers of water and energy. In this context, our government is examining whether sustainable data centers can be promoted," he said.
Kharge said the revised policy would also encourage development beyond Bengaluru.
"Since the existing policy is two to three years old, we are planning to make the new policy more sustainable. Apart from Bengaluru, our focus is also on Mangaluru and the coastal areas. We are in discussions with private companies. Regarding land allotment in Doddaballapur, there is no shortage of land and under the policy, we will focus on bringing in as many data centers as possible. Our focus is also on development beyond Bengaluru," he said.
He added that hyperscale data centers may not be suitable for Bengaluru due to resource constraints.
"What will suit Bengaluru is not hyperscale data centers because we do not have a port and there is also a shortage of water. Our focus is on small, medium, and large data centers, but not hyperscale data centers," Kharge said.