Gujarat has launched a new policy aimed at accelerating investments in hyperscale digital infrastructure as states across India compete to host the next generation of artificial intelligence and cloud computing facilities. The “Viksit Gujarat Data Center Policy 2026-29” sets out a framework designed to attract large-scale data center development while strengthening the state’s role in India’s expanding digital economy. The policy was announced by Chief Minister Shri Bhupendra Patel alongside Deputy Chief Minister Shri Harsh Sanghavi during an event at Mahatma Mandir in Gandhinagar. Senior government officials, industry representatives, and technology stakeholders attended the launch organized by the Department of Science and Technology. The initiative arrives as demand for AI computing capacity, cloud infrastructure, and enterprise data storage continues to reshape investment priorities across India’s technology sector.
Gujarat is positioning itself to capture a larger share of that infrastructure spending by combining policy incentives with long-term planning around energy, land availability, connectivity, and industrial development. The strategy also reflects a broader shift toward infrastructure becoming a core economic growth engine rather than simply an enabler of digital services. While launching the “Viksit Gujarat Data Center Policy 2026-29”, Chief Minister Shri Bhupendra said that this policy will make Gujarat the best destination in the country for setting up data centers. The Chief Minister said that under the visionary leadership of Prime Minister Shri Narendra Modi, India is emerging as one of the world’s largest users and producers of data. In the digital era, data has become a vital asset and is emerging as a new foundation for the economic growth of Viksit Bharat while driving the digital economy forward.
Gujarat Aligns Data Center Growth With India’s AI and Cloud Strategy
Government officials framed the policy as part of India’s wider digital infrastructure expansion, particularly as artificial intelligence applications increase demand for computing capacity and large-scale data storage. The administration said emerging industries including AI, cloud computing, electronics manufacturing, and the digital economy require significant investments in resilient infrastructure capable of supporting long-term economic growth. Officials also linked the initiative with national efforts to strengthen India’s position in advanced digital technologies. The Chief Minister stated at the event that emerging sectors such as the digital economy, artificial intelligence, cloud computing, and electronics manufacturing have gained fresh momentum, creating immense opportunities for the development of world class digital infrastructure.
Under the leadership of Prime Minister Shri Narendra Modi, this year’s Union Budget has made significant provisions to establish India as a global hub for cloud and AI infrastructure. CM highlighted that the 20 year tax holiday provided to global data center infrastructure providers will serve as a major catalyst for the growth of this sector. He said that under the leadership of the Prime Minister, Gujarat is emerging as a key player in India’s digital ecosystem. With the rapid advancement of AI based technologies, the demand for scalable data storage infrastructure is continuously increasing. Keeping this growing demand in mind and with the objective of further strengthening the State’s digital economy, the Government has implemented the “Viksit Gujarat Data Center Policy 2026-29”.
Dholera Emerges as the Centerpiece of Gujarat’s Digital Infrastructure Vision
TThe state government identified Dholera as the primary destination for future hyperscale infrastructure development. Officials said investor demand has already surpassed expectations even before the policy enters implementation, signaling strong market interest in large-scale deployments. The administration expects Dholera to evolve beyond hosting server campuses by building complementary technology ecosystems that include Global Capability Centres and upgraded transportation infrastructure. DyCM said that under the visionary leadership of Prime Minister, Gujarat has become a global brand of trust. Referring to the challenges India faced in the semiconductor and data sectors in the past, he said that although several announcements came between 1976 and 2009, the projects could not take shape. Under the guidance of the Prime Minister, the Government launched the Semiconductor Mission in 2021. Within just four months, Gujarat showcased its capabilities by inaugurating more than three Semiconductor OSAT plants.
Speaking about Dholera’s potential, he said that Dholera alone has received demand exceeding twice the capacity envisaged under the policy, paving the way for it to become the world’s largest “Data Center City.” Along with establishing data centers, the Government is also actively developing Dholera as the headquarters for Global Capability Centres (GCCs). To strengthen connectivity, a new airport in Dholera will become operational shortly, and authorities will soon begin operating a semi high speed train between Ahmedabad and Dholera. The Gujarat Government’s credibility is so strong that although the Government launched the policy today, it has already received request letters from leading companies across India and the world seeking capacities nearly double the policy’s planned capacity of 7.5 gigawatts.
Investment Expectations Reflect India’s Expanding AI Infrastructure Race
Chief Secretary Shri Manoj Kumar Das described the policy as a structural shift in Gujarat’s digital infrastructure ambitions rather than a standalone investment program. State officials estimate the framework could attract approximately ₹6 lakh crore in investments while creating substantial employment opportunities across infrastructure, engineering, operations, and digital services. Meanwhile, Gujarat believes its renewable energy capacity and coastal geography provide competitive advantages for supporting future hyperscale facilities that require reliable electricity and significant water resources. The policy underscores how competition for AI infrastructure has evolved beyond offering fiscal incentives. States are increasingly differentiating themselves through energy availability, sustainability commitments, industrial planning, and integrated digital ecosystems capable of supporting hyperscale cloud providers over the coming decade. For Gujarat, the strategy signals an ambition to become not only a preferred location for data centers but also a foundational hub for India’s AI-driven digital economy.
