U.S. communities are ferociously battling America's data-center boom. Some win, some lose, but they all get a fair chance to fight.
Not in India, where data centers by Microsoft and other U.S. tech giants get approved without public hearings. Tech companies also enjoy an array of government incentives, such as cheaper land. That is turning India into one of the fastest-growing data-center hubs in the world, with capacity estimated to grow by tenfold over the next decade, per Tokyo-based bank Nomura.
"The importance of India to major cloud providers is definitely on the rise," says John Dinsdale, chief analyst at Synergy Research Group.
He projects India to make up 3% of the world's capacity, up from 1.3% currently. "That may not sound like a big shift, but these are percentages of enormous numbers," he says.
Microsoft is investing $17.5 billion in India, its largest-ever commitment in Asia. A $15 billion investment by Google parent Alphabet will power three data-center campuses in Visakhapatnam, known as Vizag, a coastal city in India's Andhra Pradesh state. Meta Platforms, Amazon.com, and OpenAI are also adding to India's data-center capacity.
U.S. tech giants want a global footprint, and India makes sense operationally because data centers must be closer to customers to reduce the delay for data travel. Indians are the second-largest users of ChatGPT and ClaudeAI globally.
In February, India also declared zero taxes until 2047 on overseas services by foreign companies that operate data centers in India.
"Work with India and deliver for all," Narendra Modi, India's prime minister, said at an AI summit in June.
Data centers spell progress to Indian officials, and U.S. companies have found willing partners in giant Indian conglomerates, which help them navigate regulatory processes. Google is collaborating with Adani Group and telecom Bharti Airtel, while Meta partners with Reliance Industries. But for locals, it means sharing already sparse resources amid the growing menace of climate change.
Even without a data center, water from the city pipes in Vizag had been limited. Emani A.S. Sarma, 84, the former secretary to the government of India in the Ministries of Power and Finance, says he gets running water from his taps in Vizag for just three hours a day, while slums get water for less than an hour. Many residents are forced to rely on private tankers.
Sarma -- a retired nuclear physics researcher who lives within walking distance of one of Google's planned data-center campuses -- is worried that the project, which started construction in April, will make water scarcer. He keeps writing to elected officials, without getting a response. With no public hearing, Vizag residents haven't been able to put their concerns on the record as decisions are made.
Amazon, Microsoft, and Google data centers are classified as standard building and construction projects under India's 2006 environmental policy, which lacks a specific category for data centers and exempts them from holding public hearings. Such categorization also allows for an environmental appraisal at the state level, less stringent than at the national level.
"The law has not kept pace with the development, which always happens in environmental law," says lawyer D. Naga Saila. "They will have to create other categories, which are emerging."
Duddilla Sridhar Babu, IT minister for the Telangana state -- home to Microsoft's data center -- tells Barron's that all new developments are evaluated "through standard guidelines to carefully balance industry expansion with community well-being."
At least 75 projects in the U.S. were blocked or delayed amid local opposition in the first three months of 2026, a quarterly record, according to Data Center Watch, a research firm. The U.S., with thousands of data centers, has 833 active opposition groups. India has 200 to 300 data centers, and its future data centers appear unobstructed aside from one-off legal challenges.
One objection came on July 21, 2023, from 56 villagers in Mekaguda, a locality of a few thousand people near Hyderabad, where Microsoft is opening its largest data center in India. They allege the data center illegally encroaches on a public road, while its pipeline polluted their groundwater, according to Kotha Uday Kiran Reddy, the advocate representing the villagers. Microsoft denies the allegations .
The case awaits a final hearing.
In May, 68-year-old activist V.S. Krishna from a Vizag nonprofit challenged Google's clearance at India's environmental court with the help of lawyer Saila.
Two of Google's three data-center campuses -- 441 acres in total, about the size of Niagara Falls State Park -- received environmental clearances in about 10 days. One is less than a mile from a wildlife sanctuary that is home to endangered Indian leopards. It will be Google's biggest data center outside the U.S.
A win by Krishna's group could stall the project, force Google to provide a detailed environmental report in the local language, and make it hold a public hearing. Google's current proposal doesn't state the amount of water needed to cool its servers.
Google received a 25% discount on land value, a 25% discount on its water bill for 10 years, cheaper electricity for 15 years, and other subsidies from the state government.
An official permit to cut coconut and palm trees to make way for Google's data center describes the undertaking as a "government prestigious project [that] requires priority and expeditious action."
Google, expected to open its data center in 2028, didn't respond to multiple emails from Barron's. Google and Amazon run projects that replenish water by restoring lakes in India.
Amazon told Barron's that it is following applicable laws and addresses community needs through skills development and other programs.
Nonprofits and local citizen groups independently engage communities, pushing them to ask questions about the thousands of data-center jobs promised by politicians. Employment is a strong selling point in a country where 1.5 million engineers graduate annually, with many unemployed.
Research, however, shows data centers virtually run themselves. "A large data center might need less than a hundred people to run it," Synergy Research Group's Dinsdal says.
Still, "some people are very optimistic," says Arpita Kanjilal, researcher at Digital Empowerment Foundation, a nonprofit that studied the local communities around data centers. The thought is that "even if it doesn't give me a direct employment, it will create an ecosystem which will generate livelihood," like from "kirana" -- corner stores that serve data-center workers.
For the local opponents of India's data centers, even a small hope is better than none. Write to Karishma Vanjani at karishma.vanjani@dowjones.com.
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
July 02, 2026 02:00 ET (06:00 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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