In the most populous nation on earth, Microsoft and Amazon are two of the companies making significant investments to expand their infrastructure.
Aiming to become a global hub for artificial intelligence, India is pushing its aspirations as major tech companies like Microsoft and Amazon are ready to invest billions in the nation’s computing infrastructure in a bid to control the rapidly growing sector.
Indian authorities have provided incentives to IT companies to establish a range of operations, including data storage and electronics manufacturing. They anticipate that the nation will become a major exporter and consumer of AI thanks to a sizable pool of highly qualified laborers and a rapidly expanding domestic technology sector.
According to local officials, Microsoft has pledged approximately $3.7 billion to Telangana, a state in southern India. The internet giant has reportedly purchased the property in India to build data centers that will add 660 megawatts of IT capacity or roughly half a million European houses’ worth of electricity annually. This information comes from Structure Research.
Amazon, on the other hand, intends to spend over $12.7 billion on Indian cloud infrastructure by 2030.
According to Puneet Chandok, Microsoft’s president for India and South Asia, “India is one of the most exciting markets in the world for tech right now.” “The goal is to continuously increase capacity in this region of the world to support clients who are innovating for both India and the global market.”
As they compete to rule generative AI, big IT companies are focused on expanding their cloud computing capabilities. This year, Microsoft, Amazon, and Google announced plans to invest a minimum of $85 billion in infrastructure, or data centers, in Singapore, the US, Saudi Arabia, Japan, and the US.
According to Structure Research, India is predicted to rise from sixth place to the top spot in the Asia Pacific area by self-built capacity as a result of the firms’ rush to establish their own data centers there. The estimate does not include data center capacity constructed in the area by outside parties leasing the space to major technology companies and other businesses.
Based on Structure data, India would become Microsoft’s largest market outside of the US for its self-made data centers if the 660MW of additional capacity is built there. Microsoft did not respond to inquiries about the capacity or financial numbers.
Industry research organizations Structure, TeleGeography, and Dgtl Infra predict that the US, which contains northern Virginia, the largest data center market globally, and Germany will be hotspots for data center construction in the near future.
Analysts claim that the idea of “sovereign AI” has fueled national governments’ desire for data centers within their borders. Governments are eager to create their own AI tools and systems and to make sure that private data is handled and kept inside their borders.
According to Structure’s head of research Jabez Tan, governments were “looking to build AI applications that will focus on defense, military, and national security” and as such “needs to be housed in the country.
“According to Tan, cloud providers like Microsoft and Amazon now have “a lot of addressable markets” thanks to the pressure from nations with rapidly expanding economies.
With billions of dollars in incentives, Indian authorities are luring tech companies, especially in Telangana. The country’s digital economy has expanded quickly as a result of the widespread use of smartphones and inexpensive data.
Microsoft’s largest non-US research and development center is already located in India. Approximately two-thirds of the software giant’s 23,000 workers nationwide are engineers, with many of them based in Hyderabad, the capital of Telangana. As to the business, out of four AI projects on GitHub, a developer platform owned by Microsoft, one is managed from India.
But the growth of data centers, which need enormous amounts of water and electricity to run, could have negative effects on the environment. India, one of the most water-stressed countries in the world, still relies primarily on coal for power generation, despite remarkable advancements in renewable energy.
Microsoft’s intentions to expand, according to Chandok, won’t interfere with the company’s aim of being carbon neutral by 2030. The company has agreements in place with renewable energy providers, such as ReNew, to purchase clean power in India.
