Microsoft is pumping $3 billion to boost its AI and cloud computing game in India, says CEO Satya Nadella.
The investment, Microsoft’s “single-largest expansion” in India to date, is focused on upgrading existing data centers and building new ones to meet the exploding demand for cloud and AI services, he said on Tuesday.
The tech giant already has three data campuses in Pune, Mumbai, and Chennai, with a fourth coming up soon in Hyderabad. Add to that a planned facility in partnership with Reliance’s Jio, and you can see that Microsoft is pitching its flag deep into India’s tech ecosystem.
Microsoft isn’t the only player going all in. Amazon Web Services last year committed $12.7 billion to expand its local data center presence in India.
The fuss is warranted. India’s public cloud services market hit $8.3 billion in sales in 2023 and is projected to grow at an annual growth rate of 24%, reaching $24.2 billion by 2028, according to IDC.
Beyond the clouds
Microsoft claims that Azure is already among the top cloud providers in India, serving diverse clients such as automotive manufacturers, IT service giants, and government agencies.
But the Redmond, Washington-based tech giant isn’t only chasing cloud dominance — it’s doubling down on AI in India.
Nadella emphasized India’s role in the AI play and Microsoft’s plans to promote its technology stack to local startups and businesses leaning into AI.
The company plans to train 10 million Indians in AI skills, ensuring its tools are also front and center in India’s tech ecosystem.
It makes market sense. Spending on AI and gen AI in India has significantly increased, and is projected to reach $6 billion by 2027, growing at about 33% up until that point, IDC said in June last year.
The bigger picture
American tech majors are pouring billions in India and neighboring Southeast Asia to improve and upsell their platforms.
The industry’s top three hyperscalers – AWS, Google Cloud, and Microsoft Azure – have announced multibillion-dollar investments in data center capacity expansion across Indonesia, Malaysia, and Singapore.
But when it comes to India, it isn’t just about tech. It’s about winning over one of the world’s largest internet userbases.
India’s appeal has already drawn top dogs from across the tech world, from Nvidia’s Jensen Huang to AMD’s Lisa Su.
For Microsoft and Nadella, this investment is as much about staying ahead of the hyperscaler pack as it is about cementing itself as India’s go-to AI and cloud provider.
Edited by Ankush Chibber. If you have any tips, ideas or feedback, please get in touch: talk-to-us@moniify.com
