Policy / Opening up
India
India has proposed a long tax holiday for foreign cloud providers using Indian data centres.
The 2026-27 Union Budget proposed an exemption through tax year 2046-47 for eligible foreign cloud providers that serve customers through Indian data centres and local resellers. Data centres have had infrastructure status since the 2022-23 Budget, which helps with credit access. Government figures put installed data centre capacity at 1.57GW in August 2026. Enactment of the tax measure was not confirmed from a fetched source.
Power and grid
The government note of September 2026 cites 1.57GW of installed capacity and clean-power schemes, but we did not verify specific grid connection rules for data centres.
The rules and programmes
| Instrument | Kind | Status | What it does |
|---|---|---|---|
| Tax exemption for foreign cloud providers using Indian data centres | Tax or incentive | proposed | Taxation and Other Laws (Amendment) Bill 2026 FAQs describe exemption to 2046-47 where the foreign firm does not own the facility and sells via a local reseller. |
| Budget 2026-27 cloud and AI infrastructure measures | Tax or incentive | proposed | Describes a 15% on-cost safe harbour margin for related-party arrangements and keeps domestic activity taxable. |
| Infrastructure status for data centres | Policy | in force | Added to the Harmonized List of Infrastructure in the 2022-23 Budget, a policy designation rather than standalone legislation. |
Checked against the primary sources linked above on 2 October 2026. Due for review by 1 January 2027. This is a summary, not legal advice. If something is out of date, tell us.