mumbai, May 26 -- India's artificial intelligence (AI) ambitions are taking the shape of a digital warehouse boom. While semiconductor chips, models, and computing platforms capture most of the value globally, domestic capital is chasing the lower-risk, lower-value layer of data centres. But experts doubt that this boom can solve India's deeper challenge of building high-value technology capabilities and creating enough quality jobs to compete with global peers. There are 208 data centre projects in the pipeline, with planned investments of Rs.12.3 lakh crore, according to data from the economic think tank Centre for Monitoring Indian Economy (CMIE). More than 60% of this investment, or about Rs.7.6 lakh crore, was announced in FY26 alone, marking a fivefold jump in AI-linked infrastructure spending commitment between FY25 and FY26. Maharashtra leads with outstanding projects worth Rs.3.9 lakh crore, followed by Uttar Pradesh at Rs.2.54 lakh crore, driven by Am AI Labs' Rs.2.27 lakh crore Greater Noida Hyperscale Hub announced earlier this year. It is the largest private AI investment in India, with completion targeted by December 2030. India operates roughly 1.5GW of data centre capacity, but pipeline projects aim to add nearly 20GW by 2030. There are 40 upcoming hyperscale projects exceeding 100MW each, alongside eight projects of at least 1GW, according to CMIE data. For perspective, the world's largest operational data centre has a capacity of roughly 650MW. Even as India Inc. rushes into data-centres, market experts remain unconvinced. Despite being capital intensive, hyperscale data centres create relatively fewer jobs per unit of capital deployed and do not really address India's broader employment challenges, noted Sorbh Gupta, head of equity at Bajaj Finserv Asset Management. "One reason why FPIs (Foreign Portfolio Investors) have turned cautious is the perception that AI could disrupt India's IT services and white-collar outsourcing-the sectors that powers India's middle-class expansion," Gupta said. "Data centre investments alone won't solve that concern." A 1GW hyperscale data-centre campus typically creates around 200-300 permanent jobs such as data-centre technicians, critical facilities engineers and security staff, alongside 700-2,000 temporary construction roles during the buildout phase, according to a November 2025 study by the Hamm Institute for American Energy and the Zage Business of Energy Initiative. Although, at an event last week, Union minister of state for science and technology Jitendra Singh said India's data-centre push could generate nearly one lakh engineering jobs over the next four years across AI systems, cooling technologies, smart grids, renewable-energy integration and digital infrastructure. To be sure, countries like Singapore, China and UAE also saw rapid data-centre expansion during earlier phases of their AI buildout. But those investments were also accompanied by growth in semiconductors, cloud ecosystems, AI models and digital platforms, allowing them to move into higher-value parts of the AI chain. Meanwhile, domestic semiconductor project announcements fell by 94% over two years. After peaking at Rs.2.4 lakh crore in FY23 and Rs.2.3 lakh crore in FY24, planned investments fell to just Rs.19,600 crore across nine projects in FY26, CMIE data showed. The decline reflects the India Semiconductor Mission (ISM) 's changing lifecycle. Launched in 2021 with a Rs.76,000 crore outlay and hefty production incentives, the scheme struggled as corporate execution lagged government ambition, noted Amit Khanna, partner at Grant Thornton Bharat. "Indian firms are typically reluctant to commit to capital-intensive sectors with complex technological know-how, long gestation periods, and rapid obsolescence," Khanna said. "An ecosystem requires decades to build, and when India rolled out its chip policy, Taiwan, South Korea, and China were already well ahead."...