Google's $15B Visakhapatnam Data Center Raises Questions

Google broke ground on a proposed 1-gigawatt data center in Visakhapatnam, India, the company’s first in the country. The project is part of a $15 billion investment and includes an international subsea cable gateway. It could turn the coastal city into one of India’s premier artificial intelligence hubs. But questions about water, land, funding and local readiness remain unsettled. That’s the part of this story that deserves the closest look.

Visakhapatnam has long depended on its port and steel plants. It never developed the technology economy of southern cities such as Bengaluru and Hyderabad, and local leaders see the project as a chance to change that. “Our city will become better than Hyderabad,” said BRB Naidu, the sarpanch, or village head, of Tarluvada. “I think with the data centers here, we will be the focal point of the tech world and it can bring economic prosperity.” Google and state officials say the campus could create thousands of jobs and attract AI, cloud and technology businesses to the region.

The Land Question

Tarluvada sits on the city’s outskirts. Residents say they got little warning. Government surveyors arrived in early 2025, saying they were updating land records. By August, officials came back and told residents the land had been acquired. Farmer Venkata Surya Narayana put it plainly: “We didn’t even know what a data center was. We protested, but officials threatened us with jail.”

Government officials said they acquired more than 300 acres, affecting hundreds of families. Some families lack formal land titles and may not qualify for compensation. From the roof of her two-story home, T. Aruna pointed toward a hillside where excavators now work from dawn until dusk. Villagers once gathered firewood and harvested cashews there. “I wish the data center had never come here,” she said. “We feel cheated and our land has been taken away.” In February, villagers taking cattle to graze found security guards blocking their path. That’s a hard image to square with the promise of a public-private partnership built on consent.

Water and Power

Water was already scarce in Arilova, a neighborhood on Visakhapatnam’s northern edge. Government monitoring data shows groundwater levels there have fallen about 115 feet since last summer. Officials blame rapid development and extraction that outpaces natural recharge. Palli Murli, an accountant, is blunt about what he expects. “We are so fed up,” he said. “We need infrastructure, which will help us with water, not a data center, which will gulp whatever is left.”

Data centers also draw heavily on power. In Ireland, they accounted for 5% of metered electricity use a decade ago and 22% by 2024, more than all households combined. Hyperscale facilities, which house thousands of servers for AI and cloud demand, are expected to consume far more. E.A.S. Sarma, a former federal secretary in India’s power ministry who lives in Visakhapatnam, has objected to the project’s approvals. “Across parts of the United States and Europe, communities have increasingly opposed hyperscale data centers because of their electricity and water consumption,” he said. “So why is there such a rush to build them here?” He added that India lacks a dedicated data center policy. “The regulatory framework is fragmented, with many gaps. There are no clear rules governing environmental impacts.”

Incentives and Accountability

Andhra Pradesh is reportedly offering Google a 25% discount on water costs and a 25% discount on land for 10 years, along with state tax waivers and reduced power rates. The Wall Street Journal valued the package at roughly $2.3 billion over 20 years. Sarma pressed the obvious question: “Where is that money coming from? Will it come from taxpayers?” His repeated messages to government offices went unanswered.

Google’s partnership with the Adani Group, led by billionaire Gautam Adani, is also part of the project’s approval. Opposition politicians and civil society groups have alleged the company benefits from Adani’s longstanding ties to Prime Minister Narendra Modi. The Adani Group has denied preferential treatment and said it follows applicable laws when securing land and regulatory clearances. Google has made similar statements.

V.S. Krishna, state general secretary of the Human Rights Forum, a civil liberties group in Andhra Pradesh, identified the core problem. “The primary concern is the utter secrecy, the utter opacity in the manner in which these projects are unfolding,” he said. “The government has not put out any meaningful, systematic, or comprehensive information in the public domain.” State officials could not be reached or declined requests for comment.

Google’s Response

Alexander Smith, who leads technical infrastructure communications for the Asia-Pacific region at Google, said the company takes its obligations seriously. “Google’s AI Hub investment is a multi-decade commitment to Visakhapatnam and to India – and a commitment measured in decades carries an obligation to be a good neighbour,” he wrote. He said Google conducted independent environmental assessments covering “grid stability, power supply, water risk, ecology, acoustics and more” before approving the project. He also said the state allocated the land “in line with standard practices.”

In June, Google announced a “global water stewardship” commitment, pledging to replenish more water than it consumes at its sites by 2030. In Visakhapatnam, the company has promised to limit local water use through advanced air-cooling technology. Yet these commitments don’t provide figures for the campus’s expected consumption, its water sources or how much its programs will replenish. Google’s annual Environmental Report includes consumption data only for fully operational data centers, leaving residents unable to judge whether the measures add water or merely offset harm. Krishna called the plan a “fantastic greenwash.” “If the government believes there is enough water for these data centers, it should put the figures in the public domain,” he said.

State officials say the campuses will eventually draw water from the Polavaram Irrigation Project, one of India’s largest and costliest schemes. Decades of delays and cost overruns have left much of it unfinished. Environmental groups question whether it can spare anything.

Why This Matters:

The fiscal exposure here is real and largely unanswered. A package valued at roughly $2.3 billion over 20 years commits substantial public resources, and residents are right to ask who ultimately pays for discounted water and land. Markets can allocate computing capacity efficiently when terms are transparent and costs fall on the parties who benefit. When secrecy shields those terms, the burden shifts to taxpayers and families who never agreed to the deal. Property rights matter here, too. Families without formal titles may receive nothing, and that outcome cuts against the principle that land should be acquired through a clear, lawful and fairly compensated process.

Visakhapatnam may gain jobs and a place in the digital economy. Google’s investment could prove a lasting asset. But the gap between the company’s stated commitments and the figures residents need to verify them is wide. Until the state puts consumption numbers and funding terms on the public record, the city is being asked to trust a project it can’t yet examine.