Mangaluru, a coastal city in Karnataka, is rapidly emerging as one of India’s most attractive locations for data centre development. This transformation is highlighted in the recently released Mangaluru Data Centre Feasibility Study 2025, conducted by the Karnataka Digital Economy Mission (KDEM), the Silicon Beach Program (SBP), and Deloitte India. The study outlines a compelling case for Mangaluru, showcasing its cost advantages, strategic location, robust infrastructure, and growing talent pool, all of which position it as a key player in the burgeoning digital economy.
**Cost Advantages: A Game Changer for Data Centres**
One of the most striking findings of the study is Mangaluru’s significant cost advantages compared to other major cities like Mumbai and Chennai. The land leasing costs in Mangaluru are approximately â‚ą7.69 per square foot per month, which is four to five times cheaper than what developers would pay in Mumbai. This drastic reduction in land costs can lead to substantial savings for data centre operators, allowing them to allocate resources more efficiently and invest in advanced technologies.
Moreover, the power tariffs in Mangaluru range between â‚ą5.95 and â‚ą6.60 per kilowatt-hour, making it one of the most affordable locations for energy-intensive operations. Given that power consumption is one of the largest operational expenses for data centres, these lower tariffs can significantly enhance profitability. Coupled with an impressive power reliability rate of 98.56%, Mangaluru offers a stable environment for critical digital infrastructure, ensuring that operations remain uninterrupted even during peak demand periods.
**Strategic Location: The Hub-and-Spoke Model**
Mangaluru’s geographical positioning further enhances its appeal as a data centre hub. The city is strategically located to serve as a support hub for Bengaluru, India’s tech capital, under a hub-and-spoke model. This model allows for the efficient distribution of computing workloads, improving resilience and disaster recovery capabilities. As India aims to scale its national data centre capacity to 10–12 gigawatts by 2030, Mangaluru’s role as a supportive node becomes increasingly vital.
The proximity to New Mangalore Port not only facilitates easy access to international markets but also provides logistical advantages for data centre operators. The availability of large contiguous land parcels near the port, along with additional land in Balkunje and the Mangalore Special Economic Zone (MSEZ), positions Mangaluru as a prime location for future expansions.
**Infrastructure and Connectivity: Building a Robust Ecosystem**
Infrastructure is a critical component of any data centre operation, and Mangaluru excels in this regard. The city boasts 36 million square feet of contiguous land, which is essential for large-scale data centre developments. Furthermore, Mangaluru is situated in Seismic Zone III, which reduces climate and seismic risks, making it a safer choice for data centre construction.
Karnataka’s power grid currently reports zero unmet peak demand, indicating a reliable supply of electricity. The state is also investing heavily in renewable energy, with over 2,600 megawatts being added to the grid. This commitment to sustainability not only aligns with global trends towards greener energy solutions but also ensures that data centres can operate with minimal environmental impact.
In addition to physical infrastructure, Mangaluru is enhancing its connectivity through improvements in air, road, and port transport. These developments are crucial for attracting businesses that require seamless access to their data centres, whether for maintenance, upgrades, or emergency responses.
**Talent Pool: A Growing Workforce for the Digital Age**
A strong talent pool is essential for the success of any tech-driven initiative, and Mangaluru does not disappoint. The city is home to approximately 25,000 IT professionals and produces over 20,000 STEM graduates annually. This influx of skilled workers is vital for supporting the operational needs of data centres, from technical maintenance to innovative development.
The presence of educational institutions and training programs focused on technology and engineering ensures that the workforce remains competitive and well-equipped to handle the demands of the evolving digital landscape. As companies look to establish data centres in Mangaluru, they will benefit from a readily available talent pool that can drive innovation and efficiency.
**Growing Demand: Fueling the Data Centre Boom**
The demand for data centres in India is on the rise, driven by several factors including the increasing use of mobile devices, the expansion of digital services, and the rapid adoption of financial technology and artificial intelligence. The Mangaluru study highlights that this demand is not merely a reaction to short-term market cycles; rather, it reflects a fundamental shift in how businesses operate and engage with consumers.
The report also notes significant investments in the sector, with $240 million worth of Global Capability Centre (GCC) acquisitions and the emergence of smaller enterprise centres in sectors such as banking, financial services, insurance (BFSI), regulatory technology (regtech), and fintech. These developments underscore the long-term demand for regional data processing capacity, further solidifying Mangaluru’s status as a key player in the data centre landscape.
**Roadmap Ahead: Strategic Recommendations for Growth**
Looking to the future, the study outlines a comprehensive roadmap for developing Mangaluru into a leading data centre hub. In the short term, the focus should be on attracting edge data centres with capacities ranging from 10 to 50 megawatts. The goal is to reach a total of 200 megawatts across four to five operators within three years. To facilitate this growth, the study recommends implementing land subsidies and providing capital assistance to potential investors.
In the long term, the vision includes building a 1-gigawatt coastal data centre cluster over the next decade. Achieving this ambitious target will require streamlined processes for approvals, the establishment of a single coordinating agency to oversee developments, and improved access to digital land and utility services. Additionally, exploring the feasibility of a cable landing station could enhance Mangaluru’s connectivity to global networks, further boosting its attractiveness as a data centre destination.
**Conclusion: Mangaluru’s Future as a Data Centre Powerhouse**
Mangaluru is quietly assembling all the necessary fundamentals for a high-capacity, future-ready data centre ecosystem. With its cost advantages, strategic location, robust infrastructure, and growing talent pool, the city is poised to become a significant player in India’s digital economy. As the demand for data centres continues to grow, Mangaluru stands ready to meet the challenges and opportunities of the future, making it an ideal destination for tech infrastructure investment.
As stakeholders from various sectors—government, industry, and academia—come together to support this vision, Mangaluru’s transformation into a data centre hub will not only contribute to the local economy but also play a crucial role in shaping the future of digital infrastructure in India. The journey ahead is filled with potential, and Mangaluru is set to emerge as a beacon of innovation and efficiency in the data centre landscape.