# 5. Terraform Files

### .terraform

* This folder gets created whenever our provider is initialized using `terraform init`

***

### terraform.tfstate

* It represents all the states in terraform
* It keep tracks of all the changes of the resources
* It is crucial for the functionality of terraform
* It can contain sensitive information in plain text like passwords hence it should not be checked out in vesion control system
* We should use **Terraform Cloud** or self managed services like **AWS S3** to store state files encrypted

#### Local Backend

* State file is stored locally
* Uncollaborative
* Unencrypted sensitive data
* Manual approach

#### Remote Backend

* State file is stored remotely
* Collaboration possible
* Sensitive data encrypted
* Automation possible
  * We can setup pipelines
* Increased complexity

**Sample configuration for Terraform Cloud**

Free upto five users

```hcl
terraform {
  backend "remote" {
    organization = "xyz"
  }

  workspaces {
    name = "my-project"
  }
}
```

**Sample configuration for AWS**

* S3 used to store state file
* DynamoDB used for locking in race condition

```hcl
terraform {
  backend "s3" {
    bucket = "my-bucket"
	  key = "tf-infra/terraform.tfstate"
	  region = "us-east-1"
	  dynamodb-table = "terraform-state-locking"
	  encrypt = true
  }
}
```

***


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