India is preparing to introduce a dedicated policy for data centres as the government seeks to limit the effect of their rising electricity demand on consumers. Junior IT minister Jitin Prasada said the framework was intended to prevent the sector from pushing up household power bills, although he did not provide details on its provisions or publication date.

The move follows protests by residents in Mumbai and Visakhapatnam against data centres planned by Amazon and Google. The objections include concerns over water and electricity consumption, as well as noise and the possible impact of large facilities on local communities and the environment.

India currently has no dedicated national policy for data centres. The facilities operate under existing environmental and building regulations, while some states have introduced their own incentives to attract investment and develop the sector.

Prasada made the announcement at an event in New Delhi organised by the Central Electricity Authority. He said the government wanted to ensure that increased demand from data centres did not reduce the power available to other consumers or cause electricity costs to rise.

Data centres are a central part of Prime Minister Narendra Modi’s investment strategy, with the government promoting India as a location for global digital infrastructure. The sector is viewed by the government as a US$200 bn opportunity. Environmentalists have raised objections to Google’s US$15 bn project in Visakhapatnam, alleging risks to wildlife and improper use of temple land, while residents near Amazon’s proposed facility outside Mumbai have cited pressure on power and water resources. Both companies have denied wrongdoing and said advanced technologies would help reduce resource consumption.