India's data centre sector is booming, attracting significant institutional investment driven by infrastructure status, policy support, and surging AI demand. Government incentives, including cheaper credit, FDI-friendly rules, and state subsidies, are accelerating this growth. India is strategically positioning itself as a major global digital infrastructure hub, addressing data localization and fostering AI development. Despite international concerns regarding energy and water consumption, India is embracing sustainable technologies to build AI-oriented data centres. Leveraging its skilled workforce and natural resources, India aims for AI sovereignty and to host a larger share of critical digital infrastructure, ensuring its participation in the global AI race.