INSUBCONTINENT EXCLUSIVE:
By Anurag Kotoky, Rajesh Kumar Singh and Debjit ChakrabortyA string of successful bets on ports, mining and commodities helped transform
Gautam Adani from a nondescript diamond trader into a tycoon with a net worth of $10 billion.
Now the Indian businessman is setting his
sight on what he believes could become another big money maker: Selling data storage services to companies such as Amazon.com Inc
and Alphabet Inc.’s Google.
India’s government is weighing a new law that would require data to be stored locally, and his conglomerate
has said it expects to invest Rs 700 billion ($10.2 billion) to build data parks in a southern state over the next two decades
The billionaire’s hope is to capitalize on demand from foreign technology companies, who are expanding in India as the use of smartphones
and Internet surges.
If the proposed law goes through “it will explode data storage requirements, and that will need capacity,” Adani
said in a rare interview in New Delhi
“This will be a multi-billion-dollar project that will bring in the Googles and the Amazons of the world.”
It’s an approach that’s
been a hallmark of Adani’s empire: Pick a hot new industry -- especially one favored by the government -- build the infrastructure, and
keep going till you hit the top
Much like China, India has sought to draw more private investment to ramp up its infrastructure as it attempts to double GDP to $5 trillion
over coming years.
‘Nation Building’When the Indian government pushed for gas projects in cities for cooking and transportation,
Adani’s group bid for and won many licenses, a move that could make it the biggest player in gas retailing
When Prime Minister Narendra Modi pledged to develop local manufacturing of defense equipment, Adani quickly built the capacity to supply
the military by going on an aggressive shopping spree of defense contractors.
And when Adani’s group decided to get involved in operations
of airports, it bid almost double its main competitors in some cases
A clean sweep in the bidding process is set to add six airfields to the business overnight.
“Our main goal is nation building through
infrastructure,” the billionaire said
“The Adani Group has always focused on businesses in line [with] the government’s vision.”
Regulated BusinessesAdani, 57, built his
empire around heavily regulated businesses of coal mining, electricity and ports, a reflection of his ability to navigate different
political parties and governments in states and at the center in New Delhi.
The focus of his empire is the 15,000 hectare industrial zone at
Mundra in the western state of Gujarat, which houses the group’s largest port and the country’s largest power plant
Adani began commercial operations of its largest port in Mundra in 2001 and built the industrial cluster around it in the following years,
when Modi was the executive head of the state of Gujarat
Since then, Adani has rapidly expanded his various businesses, many of which complement each other.
As in other infrastructure businesses,
by expanding into data centers, the businessman would be entering a space that demands large investment
He would also have to contend with competition from any other large Indian players who decide to make a big push into the industry.
Personal
DataOne of the big supporters of data localization has been Adani’s fellow billionaire Mukesh Ambani, Asia’s richest man
Ambani has argued that India’s data must be controlled and owned by Indians, and not by global corporations
Ambani’s younger brother, Anil, has also built data centers in India.
A draft of India’s 2018 Personal Data Protection Bill mandates
storage of personal data on a server or in a data center located in the country, citing the need to protect the autonomy of individuals and
The bill, considered by the government, would need to be approved by lawmakers.
“The concerns over data security is fueling the need for
countries to demand localization of data and India being a growing economy, I don’t expect global data giants like Google, Amazon or
Alibaba to overlook this market,” said Apalak Ghosh, industry manager for digital transformation at Frost - Sullivan.
While that would
offer a big business opportunity for service providers, the need for real estate would mean that investments could run into “billions of
