Blocked In Virginia, Built In Vizag

On 2 July, one of the largest data centre campuses ever proposed on earth quietly died.

The Prince William Digital Gateway would have buried 2,100 acres of rural Virginia under more than 22 million square feet of servers, right up against the Manassas National Battlefield Park. Then a Blackstone-owned developer called QTS withdrew its final appeal to the Virginia Supreme Court, and the whole thing collapsed.

What killed it was not the emissions or water contamination, but rather a newspaper notice…or the lack of.

Courts found the county had failed to advertise the rezoning properly, and a coalition of homeowners and a battlefield preservation group used that technicality to outlast one of the richest developers on the planet.

This is not an outlier anymore.

The West Is Slamming The Door

Across the United States, residents are fighting data centres and winning.

In the first quarter of 2026 alone, opponents blocked or delayed at least 75 projects worth around $130 billion, roughly matching the total for all of 2025. The number of active opposition groups more than doubled to 833 across 49 states. Over the previous two years, the same tracker had logged $18 billion in projects blocked and $46 billion delayed.

Residents raise the same objections everywhere. They worry about water use, higher electricity bills, noise, and the strain on local land. And public opinion is on their side. By May 2026, 71% of Americans said they did not want an AI data centre anywhere near their home.

So the industry is looking elsewhere, to places where communities have far less power to say no.

India Rolls Out The Red Carpet

On 1 February 2026, Finance Minister Nirmala Sitharaman stood up in Parliament and offered global cloud firms something extraordinary. A tax holiday until 2047 on income earned from customers abroad, so long as that income runs through data centres built on Indian soil.

That is a roughly two-decade exemption, timed to India's centenary. And the money is already pouring in.

At the India AI Impact Summit in February, Mukesh Ambani pledged that Reliance and Jio would spend Rs 10 lakh crore, about $110 billion, over seven years, anchored by multi-gigawatt data centres in Jamnagar. He is not alone. The Adani Group has announced $100 billion in hyperscale data centres by 2035. Google and AdaniConneX are building a $15 billion AI hub near Visakhapatnam, or Vizag. Meta, Microsoft and Amazon are all building in India as well.

India's data centre capacity sat at roughly 1.5 GW in 2025. Analysts at CEEW expect it to reach around 6.5 GW by 2030. Deloitte's estimate runs higher still, at 8 to 10 GW.

Much of this construction is happening in parts of India that are already short of water.

The Undiscussed Resource Problem

More than half of India's existing data centres already sit in water-stressed regions, according to WRI India. Three quarters of them are crammed into five states: Maharashtra, Tamil Nadu, Karnataka, Telangana and Uttar Pradesh.

Now look at where the new capacity is heading. Maharashtra alone is set to take nearly 45% of planned data centre power, with Mumbai as the hub, a city whose supply lakes have run down to under a tenth of their capacity. Some years back Bengaluru went through one of its worst water crises in 500 years. Chennai hit "Day Zero" in 2019 when its reservoirs ran dry, and Hyderabad is projected to face a growing daily deficit. The industry clusters in these states for connectivity, land and power, and those hubs happen to sit in some of the country's most water-stressed regions.

CEEW estimates India's data centres drank roughly 150 billion litres of water in 2025, and expects that to more than double by 2030. It is the same water that households and farms depend on.

Neo-Colonialism?

That is exactly the charge critics are levelling.

Take E.A.S. Sarma, a former Union Power Secretary. In a public letter to the Finance Minister, he asked whether the 2047 tax break formed part of "India bartering away its sovereignty" to the United States. He called it discriminatory, warned it would smother home-grown AI, and pointed to the absurdity of Indian taxpayers and displaced landowners subsidising foreign firms that book their profits somewhere else.

The Human Rights Forum has been fighting the Google-Adani project in Vizag. It calls the project a "looming environmental and economic disaster," and says Google moved its plans to the Global South, after losing ground in the West, "because of weaker regulatory safeguards and stronger political pliability."

The state handed over 480 acres and an incentive package worth Rs 22,002 crore over 20 years. No cumulative environmental impact assessment was made public. The whole thing was slotted into a regulatory category that conveniently sidesteps mandatory public hearings.

Academics have a name for this…they call it "data colonialism". Companies pull data and resources out of poorer countries, process them on infrastructure owned in the wealthy North, and keep the money abroad.

We have watched this film before. In Uruguay, Google's planned data centre in Canelones was set to draw 7.6 million litres of drinking water a day, the daily use of 55,000 people, during the country's worst drought in 74 years. Protesters marched under a single slogan. "No es sequía, es saqueo." (It's not drought, it's pillage.) Daniel Peña, a researcher at the University of the Republic in Montevideo, pointed out that the plant sat inside a duty-free zone, so it would pay no tax and "give Uruguay virtually nothing."

Vizag is heading in the same direction.

Nation-Building, Or Renting Out The Country?

India's leaders tell a very different story, and it deserves a careful hearing.

Ambani frames all of this as independence, not extraction. "India cannot afford to rent intelligence," he told the summit, calling Reliance's billions "patient, disciplined, nation-building capital" for a sovereign compute base. His Jamnagar campus is set to run on up to 10 GW of green power from Reliance's own solar projects. On carbon and grid strain, at least, Reliance has an answer that many of the Western projects did not.

But there is a catch in the word "sovereignty." The 2047 tax holiday goes only to foreign cloud companies; Indian operators do not get the same break, which is why Sarma calls the policy discriminatory towards domestic firms. And the servers are still going up in drought-prone states that have no environmental law written specifically for data centres.

So the outcome is simple. Residents in Virginia can stop a data centre. Residents outside Visakhapatnam, for now, cannot. When the West refuses these projects, they do not disappear but simply move to countries with weaker rules .

India has offered to be one of them.

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