India Announces 20-Year Tax Holiday for Foreign Data Centre Companies in Union Budget 2026

1 min read Updated on 01 Feb 2026, 02:23 PM

Reviewed by

Radhika SScanX News Team

Overview

Union Budget 2026 introduces a two-decade tax holiday for foreign companies providing global data centre services from India. The government announced this initiative as part of efforts to attract investment into India's fast-growing digital infrastructure sector and strengthen the country's position in the global digital market.

*this image is generated using AI for illustrative purposes only.

The Indian government has unveiled a major tax incentive in Union Budget 2026 aimed at strengthening the country's position in the global digital infrastructure market. The announcement introduces a comprehensive two-decade tax holiday for foreign companies that establish and operate global data centre services from India.

Key Policy Details

The tax holiday specifically targets foreign companies providing global data centre services from Indian locations. This strategic policy framework is designed to create a competitive advantage for India in attracting international digital infrastructure investments.

Policy Feature:	Details
Tax Holiday Duration:	Two decades
Target Companies:	Foreign companies
Service Scope:	Global data centre services
Operating Base:	India

Strategic Investment Initiative

The government has positioned this tax holiday as part of broader efforts to attract investment into India's fast-growing digital infrastructure sector. The policy reflects recognition of the significant growth potential in the digital infrastructure space and aims to leverage India's capabilities to serve global markets.

This initiative demonstrates the government's commitment to creating favorable conditions for international companies looking to establish data centre operations. The two-decade timeframe provides long-term certainty for foreign investors considering substantial infrastructure investments in the Indian market.

Digital Infrastructure Focus

The announcement underscores the government's strategic focus on developing India's digital infrastructure capabilities. By offering substantial tax incentives, the policy aims to position India as an attractive destination for global data centre operations and enhance the country's role in the international digital economy.

Automobile Sector Anticipates Higher Capital Expenditure in FY27 Budget to Boost Infrastructure and Demand

1 min read Updated on 01 Feb 2026, 02:19 PM

Reviewed by

Radhika SScanX News Team

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Overview

India's automobile sector is expressing positive expectations for the FY27 budget, with industry executives anticipating higher capital expenditure allocations that could boost infrastructure activity and support sector demand. The expected increase in government spending on infrastructure projects is viewed as a catalyst for automobile sector growth across various segments.

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India's automobile sector is expressing optimism ahead of the FY27 budget, with industry executives anticipating that higher capital expenditure allocations could provide significant momentum to the sector's growth prospects.

Industry Expectations for Infrastructure Boost

According to industry executives, the expected increase in capital expenditure outlay in the FY27 budget is viewed as a crucial factor that could spur infrastructure activity across the country. This anticipated government spending is seen as having direct implications for automobile sector demand, creating positive sentiment among industry stakeholders.

Capital Expenditure Impact on Automobile Demand

The automobile industry's expectations center around the belief that enhanced government capital expenditure will translate into increased infrastructure development projects. Such projects typically require substantial transportation and logistics support, which could drive demand for commercial vehicles, construction equipment, and related automobile segments.

Industry executives view the potential budget allocation as an opportunity to strengthen the sector's fundamentals through improved infrastructure connectivity and increased economic activity. The anticipated capital expenditure increase is expected to create a favorable environment for automobile manufacturers and suppliers across various market segments.

Sector Outlook

The positive outlook from automobile industry executives reflects confidence in the government's continued focus on infrastructure development as a key economic driver. The sector's expectations highlight the interconnected nature of government spending, infrastructure development, and automobile demand in India's economic ecosystem.