Mint Explainer: Why India’s space data centre dreams could be far-fetched

Why are space data centres such a hot topic?

In 2025, multiple parties discussed deploying satellites with GPUs (graphics processing unit) in space, replicating what data centres do on Earth to run modern-day artificial intelligence. On 30 March, US space data centre startup Starcloud became one of the fastest to raise nearly $200 million and hit unicorn valuation. In May last year, former Google chief Eric Schmidt also acquired space firm Relativity, with the goal of launching GPUs in space. Google and Amazon, too, have similar ideas for conducting trials of space data centres. while Musk entered the conversation in October, pushing the concept further into the mainstream.

What are the advantages of putting GPUs in orbit?

The idea stemmed from how strenuous data centres are on energy and water resources on earth, and how much heat they generate, in line with rising global warming concerns. Experts hypothesized that with objects in space having the potential for unlimited and uninterrupted solar energy supply, satellites carrying GPUs can simply draw solar power for operations. This, coupled with new cooling technologies, would make space data centres viable alternatives to on-ground ones. With widespread criticism over environmental impact, innovators took a leaf out of satellite playbooks to ideate the space-based centres.

Are Indian companies pursuing this too?

Yes. On 13 February, Indian rocket manufacturing startup Agnikul Cosmos announced a partnership with homegrown cloud services startup NeevCloud to deploy data centres in space as early as the end of the current fiscal year. On 4 May, a similar two-party partnership was announced between Sarvam, India’s most-funded generative AI startup, and Pixxel, India’s second-most-funded space startup. The latter seeks to launch Pathfinder, a satellite with GPUs on board, to work as data centres orbiting earth.

What are the challenges facing this idea?

The challenges are practically infinite. The first is access to capital: space launch services are expensive, and deploying a constellation of satellites requires multiple such launches. Engineering is also highly complex, requiring extremely heavy heat shields to protect the internal hardware from prolonged solar exposure. Experts have also argued that solar energy itself is not exponentially more efficient in space than on earth, contrary to claims. Finally, AI’s need for high amounts of data at minimal latency is far from what satellite data transmissions can do so far. All of this would require decades of R&D and billions of dollars to be sustainable.

Does all of this even make any practical sense?

In India's case, space data centres are hard to justify. Agnikul, which has so far raised nearly $70 million, is yet to conduct a single orbital rocket launch. NeevCloud, its partner, is reportedly seeking $1.2 billion—though its own business stands unproven with less than $1 million in revenue. While Pixxel and Sarvam carry more high-profile investors, they too are yet to prove themselves commercially in their original businesses. With none, barring Pixxel, having any expertise in building satellites, and none at all with data centre expertise, India’s space data centre claims sound too premature to be taken seriously.

Shouvik has been tracking the rise and shifts of India’s technology ecosystem for over a decade, across print, broadcast and web-first platforms. He's been a tinkerer of machines and PCs since childhood, a habit he was thrilled to convert into his profession. This has led him to fascinating experiences of technologies around the world, which is what keeps him hooked to his job.<br><br>Shouvik likes to believe that he is one of the few technology journalists in India who can also code. He has also been writing about the rise of AI well before it became a household name, and has met some of the most fascinating people over the years through his work.<br><br>Shouvik writes about AI, Big Tech, data centres, electronics, semiconductors, cybersecurity, gaming, cryptocurrencies, and consumer technologies. He is most fond of the stories he has written during his time here at Mint, for which he also writes 'Transformer', a weekly technology newsletter, and hosts 'Techcetra', a weekly technology podcast.<br><br>Outside of work, Shouvik spends most of his time with Pixel, whom he believes is the world's best dog. He is also an avid reader, a toy collector, a gamer and a frequent traveller.