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December 15, 2020

Summary: Draft Data Centre Policy 2020 (MeitY)

Author: Sri Lekha

The Ministry of Electronics and Information Technology (MeitY), in November 2020, released the draft Data Centre Policy (“the Policy”) for evolution of Data Centres infrastructure within India, necessitated by the data localization provisions of the Data Protection Bill. The Policy emphasizes its vision to “Make India a Global Data Centre hub, promote investment in the sector, propel digital economy growth, enable provisioning of trusted hosting infrastructure to fulfil the growing demand of the country and facilitate state of the art service delivery to citizens.”

The Policy outlines strategies for growth of Data Centre Sector (DCS). It proposes that an “Infrastructure Status” be attributed to DCS such that it avails benefits of long-term credit from lenders at easier terms. It suggests having Data Centre Incentivization Scheme (DCIS) which will, inter alia, specify fiscal and non-fiscal incentives for DCS. It further proposes setting up of specific zones called Data Centre parks (viz. secure Data Zones to serve the high needs of storage, networking and provision of a wide range of data-related services) with necessary infrastructure such as electricity, water etc.

To create a favorable ecosystem for better operation of DCS, the Policy lists key focus areas which include provision of better infrastructure such as quality, uninterrupted and long-term power supply, setting up power generation units at the Data Centre Parks, using renewable energy etc. It indicates that MeitY along with the Department of Telecommunications would facilitate robust and cost-effective connectivity backhaul by providing utility corridors for Optical Fibre Cables, dark fibre etc. It suggests enabling a Dial Before You Dig Policy to “allow easy access to information about the underlying network infrastructure” and improving international connectivity which “will be a key driver for global players…for their Data Centre investments”. It further proposes having a single window clearance system for setting up Data Centres and declaration of Data Centres as ‘Essential Service’ under The Essential Services Maintenance Act, 1968 for enabling continued services. It emphasizes on creation of a separate category code for Data Centres buildings in the National Building Code, 2016.

The Policy proposes setting up of Data Centre Economic Zones comprising Hyper-scale Data Centers, Cloud Service Providers, IT companies, R&D units etc. It outlines an institutional mechanism for governance wherein it is proposed that the following bodies be set up: Inter-Ministerial Empowered Committee (IMEC), a decision-making body in the DCS, Data Centre Facilitation Unit under IMEC to oversee implementation of various measures and initiatives and Data Centre Industry Council to act as an interface between DCS and the Government.

The draft Policy can be accessed at: https://www.meity.gov.in/writereaddata/files/Draft%20Data%20Centre%20Policy%20-%2003112020_v5.5.pdf

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