India is the second-least preferred destination for setting up of data centres by global companies, according to a study conducted by Cushman & Wakefield.
The country ranked at the 29th place in the 'Data Centre Risk Index' study conducted among the 30 countries.
A data centre is a facility used to house computer systems and associated components, such as telecom and storage systems.
The Data Centre Risk index ranked countries based on various risk factors such as energy costs, bandwidth, ease of doing business, cost of labour and political stability.
The US topped the list, followed by the UK, Germany, Iceland and Canada.
Some Asian countries, too, scored well in the list with Qatar bagging the sixth position and Hong Kong seventh. Besides, Thailand scored 15th place, Singapore (17), Malaysia (19), Japan (20) and China (26) and Indonesia (28) are also ahead of India.
The study said main parameters that played deterrents to the attractiveness of India were ease of doing business, inflation, GDP per capita and corporation tax.
However, the country ranked high on the parameters of cost of labour and sustainability. It also noted that criteria such as quality of power and outages represents a challenge in India which is often exacerbated by increasing IT loads.
India and key Asian economies remain preferred locations for DCs and have witnessed a growth in demand owing to various advantages. India offers the advantages of cost benefits and sustainability of operations," the study said.
"We would expect the growth to continue as this is also coupled with a rising domestic demand for IT services where internet and mobile communication penetration is still moderate.
"At the same time it is important to put in place various initiatives for developing other areas such as energy, bandwidth, improving business environment, data protection laws, etc, which can enhance the proposition for India," Cushman & Wakefield India Executive Director (Consultancy) Arvind Nandan said.