New Digital Infrastructure Bill Aims to Boost Investment Certainty

Singapore's digital economy has shown remarkable growth, reaching $144.1 billion and making up 19.3 percent of the nation's Gross Domestic Product (GDP) by 2025. As more services rely on cloud providers and data centers, any disruptions can create widespread effects across both the economy and society. This concern was emphasized by Tan Kiat How, Senior Minister of State for Digital Development and Information, during a parliamentary session on October 6.

Understanding the Impact of Disruptions

Tan highlighted that disruptions do not just affect a single service; they can cascade, impacting multiple services simultaneously. This systemic risk poses challenges that are increasingly pressing as our reliance on digital services grows. Furthermore, the booming demand for computing power, particularly driven by advancements in artificial intelligence (AI), is straining Singapore's limited land, power, and water resources.

Proactive Measures for Resource Management

In light of these challenges, Singapore is taking steps to address potential resource shortages. The goal is to balance the needs of the digital economy while also considering environmental sustainability. Tan remarked on the importance of forward-thinking solutions and strategic trade-offs to extend support for the digital sector and AI development.

Working in close collaboration with industry stakeholders, the government is gradually raising performance standards, trying innovative approaches, and prudently managing the allocation of data center capacity to align with national interests.

Regulatory Framework Through the IMDA

According to Tan, the introduction of the Digital Infrastructure Bill is a pivotal move. It aims to tackle critical issues revolving around security, resilience, and sustainability. The bill is informed by the Infocomm Media and Development Authority's (IMDA) Advisory Guidelines for cloud services and data centers released in February 2025, developed with inputs from various industry partners. These guidelines draw upon global best practices and enhance the Multi-Tier Cloud Security Singapore Standard established in 2013.

Efforts towards sustainability have also led to the formulation of several standards and best practices concerning data center operations, including energy efficiency measures and liquid cooling systems. The Green Data Centre Roadmap unveiled in May 2024 outlines Singapore's long-term strategy for sustainable operation.

Introducing New Licensing Regimes

The Bill proposes to introduce two new licensing frameworks aimed at bolstering security and environmental sustainability within major data centers and cloud services. The first framework will cater to significant co-location data centers and cloud facilities that maintain a crucial IT load of at least 10 megawatts (MW).

Additionally, major cloud service providers generating over $100 million in average annual revenue from Singaporean users in the preceding three years will also fall under this new regulatory umbrella. Requirements will include stringent cybersecurity protocols, risk management processes, and a commitment to reporting any disruptions to the IMDA.

Furthermore, data centers with a critical IT load of a minimum of 3MW will need to comply with energy efficiency standards. Both existing and newly established facilities will need to make improvements in IT equipment and water use in consultation with industry standards.

Long-term Vision for Digital Infrastructure

During the deliberations about the Act's design, Tan emphasized the importance of proportional regulations that are purposeful and timely. The regulatory framework should align effectively with Singapore's unique requirements while being adaptable to advancements in technology and international standards.

The Ministry of Digital Development and Information remarks that predictable and reliable regulations are crucial for attracting investment in digital infrastructure that has a long-term outlook. When passed, the Digital Infrastructure Act will ensure the reliability and resilience of the platforms that underpin the nation's digital landscape.

In conclusion, Tan expressed that the ultimate goal is not merely to achieve maximum computing power but to extract maximum value from that computing capability, benefitting Singapore, its businesses, and its citizens — not just presently, but also looking well into the future.