Andhra’s Data Centre Policy Faces Legal, Fiscal Questions

The scrutiny has emerged ahead of the Google-Adani data centre cluster in Visakhapatnam. One of the policies under examination is a proposed Deemed Distribution Licence. Under this proposal, data centres would be allowed to act as their own power distributors. The licence is part of the state's broader effort to support AI data centre investment.

The proposed licence has raised questions about its legal basis and its financial implications. Because data centres would take on the role of distributors, the arrangement changes the way large electricity consumers are served within the state. The questions are raised in connection with the Google-Adani cluster, which would operate under the policy framework. The report indicates that the legal and fiscal concerns have drawn attention before the cluster proceeds. It does not specify the precise legal provisions or the fiscal amounts involved.

The timing of the scrutiny is linked to the Visakhapatnam data centre cluster. The policy is part of the state's wider AI data centre policies, which are focused on attracting technology investment. The report treats the legal and fiscal questions as unresolved aspects of the policy. Further details would be needed to determine how the policy will be reconciled with existing law and what the fiscal consequences will be.