The cloud that drains the ground

India’s digital revolution is often portrayed as clean, futuristic and almost weightless. Artificial intelligence, cloud computing and digital services appear to exist in an invisible world. Yet behind this image stands an enormous physical infrastructure of warehouses packed with servers, cooling systems, power stations and transmission lines.

Local communities across the United States, Europe and Southeast Asia have now begun resisting new data centre projects. Residents are protesting what they describe as the industry’s ‘rapacious need for water, electricity and land’. However, India is moving rapidly toward becoming one of the world’s largest data centre hubs, raising an uncomfortable question: can digital ambitions coexist with ecological realities?

Driven by rising demand for artificial intelligence and cloud services, India’s data centre capacity is expected to expand dramatically, rising from ~1.4 gigawatts in 2025 to ~17 gigawatts by 2030.

Central and state governments have rolled out incentives to attract global technology giants such as Google, Amazon and Microsoft. These include long tax holidays, exemptions from electricity duties, concessional land allotments and subsidies on water and infrastructure, and in some cases, relaxation of environmental safeguards. Reports surrounding Google’s proposed facility in Andhra Pradesh suggest that environmental impact assessment requirements were diluted or waived.

Prime Minister Narendra Modi has repeatedly described data centres as major employment generators, inviting “the whole world’s data to reside in India”. However, critics point out how this is an overstated promise. Once operational, hyperscale data centres usually require a small workforce consisting mainly of technicians, engineers and maintenance staff. Compared to manufacturing industries, they generate limited long-term employment despite occupying vast tracts of land and consuming enormous quantities of resources.

A water guzzler like no other

Data centres generate intense heat and require constant cooling to prevent equipment failure. A typical 100 megawatt facility using evaporative cooling can consume between 800,000 and two million litres of water daily — sufficient to meet the daily needs of thousands of households.

A number of these data centres are being built in regions already facing water stress. India’s second largest data centre hub after Mumbai — with 42 operational or under-construction facilities — is coming up in Hyderabad, a city projected to face a water deficit of nearly 909 million litres per day within the next few years.

Despite these concerns, major cloud companies continue expanding their presence there. Experts warn that during prolonged summers and heatwaves, data centres could increasingly compete for scarce water resources with residents, industries and agriculture.

A similar situation is emerging in Visakhapatnam, where investments by Google and Reliance are transforming the city into a major digital infrastructure hub. Groundwater levels in parts of the district have already fallen significantly, raising concerns about future sustainability.

Mumbai and Navi Mumbai together host the country’s largest concentration of data centres, with approximately 84 facilities either operational or under development. Industry representatives often argue that coastal facilities can use seawater for cooling, thereby reducing dependence on freshwater sources. However, the industry remains notably opaque regarding actual water consumption patterns.

They are also ignorant of the environmental costs of using seawater for cooling. Thermal pollution from discharged water can disrupt marine ecosystems, while chemical treatments and potential leakages pose additional risks to coastal habitats.

Perhaps the most revealing comparison comes from Gurgaon and Noida.

Gurgaon, widely known as north India’s cyber city and home to numerous multinational technology companies, has only a handful of operational data centres. On the other hand, Noida and Greater Noida, despite having a smaller information technology ecosystem, have emerged as major data centre destinations.

One only has to look beneath the ground for an explanation. In Gurgaon, groundwater levels have fallen to between 34 and 38 metres. In parts of Noida, groundwater remains available at much shallower depths of 20 metres. Water availability, not digital infrastructure alone, determines the geography of India’s data economy.

The electricity challenge

Data centres require uninterrupted 24x7 power supply. Although companies frequently highlight renewable energy commitments, the reality is that these facilities create continuous baseload demand that renewable sources alone often struggle to meet.

In Mumbai, rising electricity demand from data centres contributed to decisions that extended the operations of ageing coal-fired power plants. The environmental burden falls disproportionately upon communities living near these facilities. Residents in areas such as Mahul have long complained of respiratory illness, cancer and other health problems linked to industrial pollution.

Companies also instal a large number of industrial diesel generators capable of running entire facilities during power outages. Environmental scientists have warned that these generators could worsen the already dangerous levels of urban air pollution.

The physical footprint of data centres also carries social consequences.

Agricultural land, orchards and even settlements are being acquired for these projects. In Telangana, concerns have emerged over the acquisition of land originally distributed to landless Scheduled Caste and Scheduled Tribe families. As data infrastructure expands questions of livelihood security and displacement are becoming increasingly important.

Beyond water, land and energy lies another growing challenge: electronic waste.

Artificial intelligence hardware evolves rapidly, with processors often becoming obsolete within two to five years. According to researchers, generative AI technologies alone could produce an estimated millions of tonnes of electronic waste globally by 2030.

India’s informal recycling sector already handles much of the country’s electronic waste through unsafe dismantling and burning practices. Heavy metals, toxic chemicals and dioxins can contaminate soil, groundwater and air. As one researcher observed, the AI boom may eventually fade, but the waste it leaves behind could persist for decades.

India’s digital future may be inevitable, but its environmental consequences are not. Mandatory use of treated wastewater, closed-loop cooling systems and non-potable water sources could significantly reduce pressure on freshwater reserves.

Greater transparency regarding resource consumption and stronger participation by local governments could ensure that communities have a voice in decisions affecting their land and resources.

Another important question raised by environmentalists deserves serious attention: Are these data centres genuinely enhancing national sovereignty, or are they merely hosting global corporate infrastructure within India?

The answer will shape India’s digital future. The country’s pursuit of artificial intelligence and cloud computing must not come at the cost of depleted aquifers, coal dependence and worsening environmental inequality. The choices made over the next decade will determine whether India’s data centre boom becomes a sustainable foundation for digital growth or remains a silicon mirage built upon exhausted landscapes and disappearing water.