India needs guardrails alongside incentives for data centre growth

India's push to attract data centre investments must be accompanied by safeguards to address environmental concerns, particularly water stress in several regions. While building necessary infrastructure is critical for the country's digital economy, the expansion must proceed responsibly.

Alternative cooling technologies, including liquid cooling systems that can significantly reduce water consumption, present a viable path forward. Many such technologies are currently imported, creating an opportunity for Indian companies to develop domestic capabilities in this space.

Balancing growth incentives with environmental accountability will be key to ensuring data centre development supports long-term sustainability and addresses regional water challenges.