India 2nd Most Risky Country to Setup Data Centers

A new study ranks India as one of the riskiest countries to set up a data center based on parameters such as ease of doing business, availability of bandwidth and water.

In the data center risk index, published by Cushman & Wakefield, India is ranked 29th out of 30 countries which were looked at. The study ranks United States, United Kingdom, Sweden, Germany and Canada as the least riskiest countries to setup data centers (in that order).

Brazil, India, Indonesia, Brazil and Japan are the riskiest, according to the ranking.

This comes at a time when the Indian government and association of Internet service providers have been trying to get multinational companies such as Google and Facebook to setup servers and data centers in India. The demand to setup local servers has come when those companies are being questioned over their involvement in PRISM, a US government program to spy on the digital lives of citizen.

Data Center Risk Index 2013 Cushman & Wakefield
Data Center Risk Index 2013 Cushman & Wakefield

“The retail data center market has continued to grow with operators beginning to build out larger Tier-III facilities. The opportunities for growth are substantial but the ease of doing business is still a barrier. Power security still remains a significant risk stemming from the lack of diversity of energy imports and increasing reliance on imported oil making it still the highest risk country in the APAC region. However despite these challenges, the perspective remains that long-term India will be an attractive investment opportunity,” the study said.

Cost of energy, bandwidth, ease of doing business, taxes, political stability, energy security and availability of water etc play an important role when it comes to assessing the feasibility of setting up a data center in the country.

According to Data Center Dynamics, “..investment in India’s data center market was expected to reach US$4.4bn in 2012, up from $4.1bn in 2011 (China investment for 2012 was expected to be $8.7bn and Brazil’s $5.5bn).”

Download the full report here (registration required).