India Inc Bets Big on Tech: Data Centres and AI Drive 56% of Massive ₹26.75 Lakh Crore Capex Surge
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Despite persistent global turbulence, trade tensions, and international conflict, Indian businesses are pushing ahead with ambitious capital expenditure plans. Between April 1 and August 5, total investment announcements reached a staggering ₹26.75 lakh crore, driven predominantly by domestic private corporations and a massive boom in artificial intelligence (AI) and data centre infrastructure.
According to a fresh analysis of the Centre for Monitoring Indian Economy (CMIE) Capex database released by Bank of Baroda, the initial four months of FY27 reveal a clear structural shift in where corporate India is placing its long-term bets.
Tech and Nuclear Power Take Centre Stage
The standout driver of this investment wave is the Information Technology Enabled Services (ITES) sector, which accounts for a colossal 56%—or ₹14.98 lakh crore—of all announced investments. Remarkably, nearly 99% of this outlay comes from just 13 companies directing funds into AI and data centre development. The trend builds on policy tailwinds introduced in the Union Budget aimed at positioning India as a global data processing and cloud computing hub.
Following ITES, conventional electricity emerged as the second-largest sector, attracting ₹6.86 lakh crore across seven major projects. In a significant shift towards clean baseload power, four companies alone account for ₹6.5 lakh crore focused on nuclear energy expansion.
Sector / Industry | Share of Total (%) | Key Details & Outlay |
ITES (Data Centres & AI) | 56.0% | ₹14.98 lakh crore (99% in AI & Data Centres across 13 firms) |
Conventional Electricity | 25.7% | ₹6.86 lakh crore across 7 firms (₹6.5 lakh crore in nuclear power) |
Aluminium & Aluminium Products | 5.0% | Driven by front-end infrastructure demand |
Steel | 3.8% | Backed by public infrastructure traction |
Other Electronics | 1.9% | ~₹51,000 crore (~2/3 in solar cells & batteries via PLI) |
Renewables | 1.0% | ~₹25,000 crore (primarily solar power generation) |
Consumer Goods & Autos | < 0.7% | Less than ₹2,000 crore (reflects caution and surplus capacity) |
Other critical sectors securing notable commitments include electronics and storage at ₹51,000 crore, where two-thirds is channeled into solar cells and battery production via the central government's Production Linked Incentive (PLI) scheme. Renewables pulled in ₹25,000 crore, while primary metals like aluminium and steel continue to see steady traction backed by sustained domestic demand for public infrastructure development.
Private Sector Leads the Charge, Consumer Goods Lag Behind
In a reassuring sign for market watchers, the domestic private sector is spearheading this capex cycle, contributing 86% (₹23.01 lakh crore) of total investment announcements. Foreign firms accounted for nearly 8% (₹2.11 lakh crore), while central and state government commercial entities comprised the remaining share.
Ownership Category | Investment Value (₹ Crore) | Share of Total (%) |
Private Indian | 23,01,828 | 86.0% |
Private (Foreign) | 2,11,344 | 7.9% |
Central Government Enterprises | 1,50,737 | 5.6% |
State Government Enterprises | 11,571 | 0.4% |
Total Capex Announced | 26,75,479 | 100.0% |
However, the investment enthusiasm remains narrow. The consumer goods segment—including the automotive sector—saw less than ₹2,000 crore in total announcements, representing a modest 0.7% of the total. Industry analysts point to surplus capacity and cautious consumer demand as key reasons why consumer-focused businesses are holding back or deferring capital commitments until global geopolitical clarity emerges.
