75% of Indian Businesses Embrace Data Localization as AI Drives Strategy

A surge in AI adoption is accelerating data localization trends, with 75% of Indian businesses now prioritizing local data storage to comply with evolving regulations and harness AI-driven insights, according to industry reports. The Digital Personal Data Protection Act (DPDPA) and sector-specific mandates like the RBI’s payment data rules are key drivers, alongside the need for faster data access and enhanced security in AI applications.

 

Key insights:

 

AI adoption: 30% of Indian businesses already leverage AI (above the world average of 26%), requiring local data for performance and compliance.

 

Sectoral mandates: Finance and telecom sectors are spearheading with strict localization, with draft rules on proposed DPDPA indicating a central authority to oversee cross-sector mandates.

 

Economic impact: Local data centers will receive $10 billion investment by 2025, supporting India's technology self-reliance.

 

They warned that dual regulation would overstretch compliance, especially for multi-nationals operating in India's new data governance framework.

 

Sources: TechCircle, BCG, TeamLease Regtech