Karnataka Minister Addresses Google Data Centre Shift to Andhra Pradesh
In response to criticism over Google's data centre project relocating to Visakhapatnam in Andhra Pradesh instead of Bengaluru, Karnataka's IT-BT Minister Priyank Kharge has provided a detailed explanation. He highlighted that the neighbouring state offered substantial subsidies, which influenced the decision.
Subsidy Details Revealed by Minister Kharge
Priyank Kharge stated, "Everyone talks about Google moving to Visakhapatnam, but no one speaks about the cost at which it has gone there. The Andhra Pradesh government has given a subsidy of Rs 22,000 crore for the Google project." He elaborated on the specific incentives, including a 25 per cent land subsidy, a Re 1 reduction in power tariff per unit for 15 years, a 10 per cent GST exemption for 10 years, 100 per cent exemption on stamp duty, and a 10 per cent capital subsidy on plant and machinery. Despite these benefits, the project is expected to generate only about 1,500 jobs.
Resource Intensity of Data Centres
The minister explained the significant resources required for data centres, emphasizing their power and water sensitivity. "Data centres are extremely power-sensitive. For a one-megawatt plant, we require around Rs 70 crore. In one acre of land, only a one-megawatt plant can be set up," he said. Additionally, he noted that about 25 million litres of water per megawatt are needed annually to operate a data centre. To illustrate the scale, Kharge mentioned, "If one asks five questions on ChatGPT, about 500 ml of water is consumed. That is the scale of consumption. Now, with new technology, companies are using liquid cooling and treated water."
Karnataka's Data Centre Policy Review
Replying to Dheeraj Muniraju in the assembly, Priyank Kharge announced that the Karnataka government will review its data centre policy, which was introduced three years ago, to align it with recent sector developments. He pointed out that while Karnataka ranks first in the IT sector, it stands fifth in terms of data centres. Currently, 32 data centres are operating privately in the state.
The minister added, "The data centres required huge quantities of water and power and hence the coastal region is suitable for it." He revealed that the state has written to the Centre seeking a subsea cable for the coastal region, with the Centre assuring cooperation if private firms come forward to establish it. "That is why we will relook at our policy and come up with a sustainable data centre policy," he concluded.
Hyperscale Data Centres Ruled Out for Bengaluru
Priyank Kharge also ruled out the possibility of hyperscale data centres in Bengaluru due to resource constraints, underscoring the need for strategic planning in data centre development across Karnataka.
