It's about the delta. Similar kinds of buildouts weren't common 3-5 years ago.

China as well as India are seeing a significant buildout of DC capacity which is partially a result of subsidies but also a result of increased demand for services domestically as well as within APAC.

While local politicans in the US are using populist misinformation such as water usage to push back against DC buildouts, you're seeing both China [0] and India [1] offering multi-decade subsidizes and tax shelters to build out DC capacity, which leads to a snowball effect as supply chains and ecosystems start shifting to those centers of gravity - this is what happened to semiconductor fabrication (Upstate NY to Taiwan/SK) and Cybersecurity (Bay Area/Boston to Israel/CEE/India) 15 years ago.

Additionally, this is essentially HPC and best in breed hardware doesn't neccesarily equate to outcompeting a large amount of less performant but scaled out compute, which is the path both China and India are adopting by pushing hyperscalers to (in China's case) use domestic vendors or (in India's case) transfer the entire IP chain to an Indian subsidiary. This is why you see Amazon announce layoffs [2] while committing to spend tens of billions of dollars in India's hyperscaler buildout [3] or Marvell expanding in Vietnam [6] after a similar sized layoff [7].

Barely 10 years ago, states like California, NC, etc used to use similar strategies to compete with each other and build out innovation hubs, but state and local level politicking has led to public-private partnerships stagnating and incentivized beancounters like me to seriously consider offshoring or shutting down "innovation centers" in RTP/Boulder/ATX tier hubs.

CHIPS and the IRA were on the right track, but even Dems [4] and the EU [5] as well as the GOP tried to stymie it.

[0] - https://www.reuters.com/world/asia-pacific/china-offers-tech...

[1] - https://techcrunch.com/2026/02/01/india-offers-zero-taxes-th...

[2] - https://www.reuters.com/business/world-at-work/amazon-plans-...

[3] - https://www.aboutamazon.in/news/economic-impact/amazon-econo...

[4] - https://www.nytimes.com/2024/01/10/us/politics/semiconductor...

[5] - https://www.cnbc.com/amp/2022/11/09/europe-shows-a-united-fr...

[6] - https://www.marvell.com/company/newsroom/marvell-accelerates...

[7] - https://www.crn.com/news/computing/semiconductor-firm-marvel...

China's Data Center Boom: A View from Zhangjiakou (2025)

Comments