UP's Data Centre Policy Wins Industry Backing, Faces Execution Test

The Uttar Pradesh Data Centre Policy 2026 reflects India's evolving approach to building AI-ready digital infrastructure.

Replacing the previous policy, which expired on January 27, the new framework aims to position Uttar Pradesh as a green, AI-ready data centre hub by adding 2 GW of new data centre capacity and attracting investments exceeding ₹2 lakh crore.

The policy focuses on AI-ready infrastructure, GPU-based computing, energy efficiency, sustainable operations and green data centres. It also introduces AI Compute Booster incentives to accelerate AI infrastructure deployment, as well as incentives for tier-3 and tier-4 data centres. Additional benefits for projects in Bundelkhand and Purvanchal are designed to encourage balanced regional development.

The state's first Data Centre Policy, introduced in January 2021 and amended in November 2022, led to the approval of six data centre parks and two standalone data centre units, attracting investments of around ₹21,343 crore. Seven projects are already operational.

Building on that foundation, the 2026 policy aims to significantly expand Uttar Pradesh's digital infrastructure ecosystem while driving AI adoption, employment generation and private investment.

Industry executives say the policy reflects a broader shift in India's digital infrastructure strategy, with data centres increasingly viewed as critical infrastructure supporting AI, cloud computing and the digital economy.

However, they caution that the policy's long-term success will depend on execution, particularly the availability of reliable renewable power and the development of a supporting ecosystem.

Rajveer Shah, Global Chief Strategy Officer at Mitsumi Distribution, tells AIM that the policy demonstrates a more mature understanding of the requirements of large-scale digital infrastructure.

"The Uttar Pradesh Data Centre Policy 2026 reflects a maturing understanding of what large-scale digital infrastructure actually demands. The focus on renewable energy is not incidental. Data centres are among the most energy-intensive facilities in modern infrastructure, and as AI workloads drive exponential growth in compute demand, sustainability can no longer be treated as a secondary consideration. Embedding green energy principles at the policy level, rather than leaving them to individual operators, is the right approach," Shah says.

He says the policy's emphasis on GPU infrastructure, energy efficiency and sustainable operations aligns with India's rapidly expanding renewable energy capacity.

"The real test will be execution: consistent power availability and the speed at which renewable supply scales to meet data centre demand," he says.

According to Shah, the policy signals India's intent to build digital infrastructure that is both AI-ready and environmentally sustainable. For operators already investing in hyperscale infrastructure, it provides greater confidence to expand their presence in the state.

Sunil Gupta, Co-Founder, CEO and MD of Yotta Data Services, tells AIM that the policy is a major step towards strengthening India's AI infrastructure ambitions.

"The Uttar Pradesh Data Centre Policy 2026 is a highly progressive initiative that reinforces India's ambition to become a global AI powerhouse. With its focus on AI-ready digital infrastructure, GPU-based compute, energy-efficient operations, and an additional 2 GW of data centre capacity in the region, the policy lays a strong foundation for accelerating AI-led investment across northern India," Gupta says.

Gupta notes that Yotta already has a significant presence in Uttar Pradesh through its Greater Noida campus and plans to expand further.

"Yotta already has a significant footprint in Uttar Pradesh, with a 20-acre campus in Greater Noida scalable up to 250 MW, and this policy gives us added confidence to deepen that commitment. We are setting up India's largest AI supercluster of 30,000 NVIDIA Blackwell B300 liquid-cooled GPUs at this campus, backed by an investment exceeding $2.5 billion (~₹21,500 crore), which will anchor Uttar Pradesh as a frontier destination for large-scale AI compute," Gupta says.

He adds that the policy creates the right environment for expanding sovereign AI infrastructure and hyperscale cloud services while contributing to employment and regional economic growth.

Sachin Alug, CEO, NLB Services, also mentions to AIM that "The focus is shifting from Noida, an established GCC hotspot, as downstream sectors such as BFSI and software and technology gravitate to tier 2 cities."

"Beyond infrastructure, our presence in Uttar Pradesh is generating significant employment opportunities and contributing meaningfully to the state's economy," Gupta says.

Jatinder Singh Pabla, Chief Sales and Marketing Officer at STT GDC India, tells AIM that the policy will accelerate the development of AI-ready infrastructure.

"As AI, cloud and high-performance computing continue to transform business operations, the state is well positioned to support the next wave of digital transformation through scalable and resilient data centre infrastructure. The state's Data Centre Policy is a significant step forward and is expected to accelerate investments, strengthen the digital ecosystem, and drive the development of AI-ready infrastructure by hyperscalers, cloud providers and technology companies," Pabla says.

STT GDC India has already committed significant investments in Uttar Pradesh through two campuses in Noida and Greater Noida.

Its footprint in the state includes a 96-MW IT capacity campus in Noida and an 110-MW IT capacity campus in Greater Noida. Once fully operational, the two campuses will provide a combined IT capacity of around 210 MW.

"These campuses reinforce our commitment to building scalable, AI-ready infrastructure that meets the evolving needs of enterprises, cloud providers and next-generation digital workloads," Pabla says.

He adds that the company's nationwide expansion reflects growing demand for digital infrastructure across India.

"With more than 610 MW of critical IT load across 34 facilities, including those under development, in 10 cities, we remain committed to supporting India's growing digital infrastructure requirements," he says.

Looking ahead, Pabla believes sustained investment and public-private collaboration will be critical to translating the policy into long-term growth.

While industry leaders have broadly welcomed the policy, they agree that incentives alone will not determine its success. Reliable renewable power, faster project approvals, stronger connectivity and the development of a broader AI ecosystem around data centres will ultimately determine whether Uttar Pradesh can translate its ambitions into a globally competitive AI infrastructure hub.

The policy also complements the Uttar Pradesh Startup Policy 2026, which targets agri-tech innovation. Together, the two policies seek to combine digital infrastructure with startup development to create a stronger ecosystem for agricultural innovation.