Microsoft makes US$17.5 billion pledge for AI cloud in India
The country of 1.45 billion people is increasingly drawing the attention of AI power brokers as a market and a source of talent and data
[BENGALURU] Microsoft pledged to invest US$17.5 billion on artificial intelligence (AI) and cloud computing in India over four years, targeting the world’s most populous nation to help fuel its growth.
Chief executive officer Satya Nadella made the announcement on Tuesday (Dec 9) after meeting with Prime Minister Narendra Modi in New Delhi, ahead of a tour through the country. Microsoft said the investment will focus on three pillars – scale, skills and sovereignty – which align with Modi’s goal of building a broad ecosystem in the country for AI innovation.
“To support the country’s ambitions, Microsoft is committing US$17.5B, our largest investment ever in Asia, to help build the infrastructure, skills, and sovereign capabilities needed for India’s AI first future,” Nadella said.
The country of 1.45 billion people is increasingly drawing the attention of AI power brokers as a market and a source of talent and data. Anthropic co-founder Dario Amodei visited the country in October, while Nvidia’s Jensen Huang and Google DeepMind’s Demis Hassabis are both expected in the coming months. India, with millions of engineers skilled in machine learning and data science, is also home to some of the world’s largest technology services companies, such as Tata Consultancy Services and Infosys.
Intel CEO Tan Lip-Bu and Cognizant Tech Solutions CEO Ravi Kumar Singisetti both posted on X Tuesday that they met with Modi.
Microsoft regularly announces multiyear investment pledges in countries around the world.
The Redmond, Washington-based company said in November that it would invest US$10 billion in Portugal to build an AI data centre along the coast. It committed last month to spending more than US$7.9 billion on data centres, cloud computing and employees in the United Arab Emirates over the next four years. In September, the firm agreed to drop US$30 billion over four years on AI infrastructure and existing business in the UK.
Overall, Microsoft’s capital expenditures are expected to total US$97.5 billion in 2026 alone.
Microsoft’s shares were down 0.1 per cent in New York trading on Tuesday.
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Microsoft is trying to entice students with free access to its AI assistant Copilot, while OpenAI in November rolled out a one-year free subscription to ChatGPT Go for all Indian users. Google, through telecom giant Reliance Jio, is offering 18 months of Gemini 2.5 Pro to half a billion subscribers.
One of Microsoft’s priorities with the investment will be to build AI infrastructure that will give the country security and sovereignty over future technologies, it said. The company’s facilities based in Hyderabad are set to go live in the middle of 2026 and will be its largest hyperscale region in India, Microsoft added.
Nadella, who was born in India and studied engineering there before moving to the US as a graduate student, plans to visit Bangalore and Mumbai during the trip. During his last visit in January, he committed US$3 billion over the next two years. BLOOMBERG
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