India is racing to position itself as a global powerhouse in artificial intelligence, with billions of dollars in technology investments pouring into the country. But as construction accelerates, residents living near major data centre projects are raising concerns over noise, water shortages, electricity demand and the loss of green spaces.
The growing resistance highlights a difficult question for Prime Minister Narendra Modi’s government: can India build the infrastructure needed to compete in the AI era without placing additional pressure on communities already facing environmental challenges?
Technology giants including Amazon, Google and Microsoft are investing heavily in Indian data centres, which provide the computing power and storage needed to run AI services and other digital platforms.
Amazon plans to invest US$21 billion in India by 2030, while Microsoft has announced a US$20.5 billion investment plan over four years, largely focused on AI infrastructure. Google has also proposed a US$15 billion data centre project in the southern state of Andhra Pradesh.
For Modi, the investments support an ambition to make India a major destination for the world’s digital infrastructure, even as the country competes with the United States and China in the rapidly expanding AI industry.
Mumbai Residents Push Back Against Amazon Data Centre
One of the most prominent disputes has emerged near Mumbai, where residents are protesting against a planned Amazon data centre in Thane.
People living nearby say construction has destroyed greenery and could bring more noise, place pressure on local resources and affect the value of their homes.
Some residents also argue that they were not meaningfully consulted before the project moved forward. More than 1,000 people living near the site have raised concerns, according to Reuters reporting.
The opposition has extended beyond complaints from individual households. Hundreds of residents gathered at a protest in September, calling for the facility to be relocated away from their neighbourhood.
For people who bought homes expecting a quieter residential environment, the arrival of a large industrial facility has become a source of anxiety about their surroundings and long-term property values.
Amazon and local authorities have defended the project, saying it will use dedicated power supplies and water-free cooling systems rather than placing additional demands on household utilities. Amazon has also said it is implementing noise-reduction measures and planted more saplings than the number of trees removed.
The company is considering further community outreach as the dispute continues.
Why AI Data Centres Raise Water and Electricity Concerns
Data centres are essential to the AI boom, but they can require substantial amounts of electricity and, depending on their cooling systems, water.
The concerns are particularly significant in India, which has about 4% of the world’s freshwater resources despite accounting for roughly 18% of the global population.
Research cited by Reuters estimates that between 60% and 80% of Indian data centres could face high water stress this decade. That creates a potential challenge as more facilities are planned in cities already struggling to manage demand for water and electricity.
Industry executives have also questioned whether data centres should be built close to residential areas, where uninterrupted power, adequate water supplies and noise management can become more contentious.
The issue is not limited to Mumbai. In Andhra Pradesh, environmentalists have opposed Google’s proposed data centre project, citing concerns over wildlife, water and electricity resources, as well as allegations involving temple land. Google and the state government have denied wrongdoing.
India’s AI Ambitions Meet Local Resistance
India is pursuing a strategy that goes beyond developing AI models. By attracting the infrastructure that powers digital services, the country hopes to strengthen its position in the global technology economy.
However, the rapid expansion of data centres is creating a clash between national economic ambitions and the concerns of communities living near proposed sites.
The government has promoted data centres as essential infrastructure for India’s digital future, arguing that modern technologies can use resources more efficiently. Residents opposing particular projects say they want stronger consultation and clearer assurances about environmental and neighbourhood impacts.
The debate could influence how future projects are approved and how technology companies engage with local communities.
Can India Build Its AI Future Without Leaving Residents Behind?
The scale of investment shows that global technology companies see India as an important market for AI infrastructure. But financial commitments alone will not resolve concerns over land use, water availability, electricity demand and the quality of life around new facilities.
For India, the challenge is to ensure that the economic benefits of the AI boom are accompanied by transparent planning, environmental safeguards and meaningful engagement with residents.
As the country seeks a larger role in the global AI race, the resistance around data centres is becoming a reminder that the digital economy still depends on physical resources — and on the communities that share them.
