Uttar Pradesh Approves New Data Centre Policy 2026, Targets ₹2 Lakh Crore Investment and AI Infrastructure

The Uttar Pradesh Cabinet has approved the Uttar Pradesh Data Center Policy 2026, replacing the 2021 policy that expired in January this year, as per news reports.  

Cleared at a meeting chaired by Chief Minister Yogi Adityanath, the policy sets a target of attracting investments of more than ₹2 lakh crore and creating 2 GW of data centre capacity.  

Incentives Linked to AI and Green Facilities 

The revised policy introduces incentives for GPU-based infrastructure, indicative of the growing demand for artificial intelligence computing.  

It also includes benefits for Tier III and Tier IV data centres, AI Compute Booster projects, and energy-efficient operations. 

Additional incentives have been announced for projects coming up in Bundelkhand and Purvanchal. Separately, the Cabinet approved a data policy for the electronics department covering data security and domestic data storage. 

Previous Projects Provide Starting Point 

The state has already seen investments under the earlier policy. IT and Electronics Minister Sunil Sharma said seven projects have become operational out of 6 approved data centre parks and two standalone data centre units.  

These projects represent investments of around ₹21,343 crore. The government expects the new policy to add to this capacity as more projects are approved over the coming years. 

The policy estimates around 7,500 direct long-term jobs once projects become operational. During the construction phase, around 50,000 temporary jobs are expected to be generated.  

Cabinet Clears Startup Policy 2026 

The Cabinet also approved the Uttar Pradesh Startup Policy 2026. The revised policy increases the monthly sustenance allowance for startups from ₹17,500 to ₹20,000 for two years.  

Prototype grants have been doubled to ₹10 lakh, while seed funding has been increased to ₹15 lakh, with higher assistance available in select cases. The government has also approved a ₹1,000 crore startup fund. 

The Startup Policy includes additional support for deep-tech sectors such as artificial intelligence, robotics, quantum technology, and space technology.  

A separate Startup Mission will be created under the Department of IT and Electronics to oversee implementation and coordinate with startups, incubators and investors. 

Read More: Finance Ministry Extends Anti-Dumping Duty on Seamless Tubes and Pipes till January 27, 2027! 

Conclusion 

With the approval of the Data Center Policy 2026, Uttar Pradesh has updated its policy framework for data centres and digital infrastructure. The Cabinet also cleared measures related to startups, governance and public infrastructure. 

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