India’s technology landscape is witnessing a significant transformation as major companies expand their data center capacities to meet the surging demand for artificial intelligence (AI) infrastructure. Reliance Industries and CtrlS are both ahead in this race to expand. They see the growing demand for better data services across the region.
Tata Consultancy Services (TCS), the largest Indian IT firm, recently raised $1 billion from private equity giant TPG. This funding is part of a bigger $2 billion plan to establish gigawatt-scale data centers across India. This significant infusion of cash underscores the increasing desire among international technology companies to gain a firm foothold in the Indian marketplace.
Amazon has made big promises, too—most recently, promising $12.7 billion to build out AWS cloud infrastructure in India by 2030. In addition, Microsoft is committing $3 billion in new investments over the next two years. This additional investment will help it make its cloud and AI infrastructure in the country much stronger. In response, Google unveiled an ambitious plan to invest $15 billion over the next five years. They plan on constructing a gigawatt-scale AI data center hub in neighboring Andhra Pradesh.
Cloud providers and big tech companies, including US big tech, have been making huge bets on India. In fact, in the two years they have released data center infrastructure budgets of more than $32 billion. India has something to say about that, producing close to one-fifth of the world’s data. It has only around 3% of global data center capacity — a significant gap between current demand and supply, particularly for AI compute resources.
India too is emerging as a serious player in the development of AI infrastructure. In point of fact, over 95% of the new data center capacity anticipated in the next five years will be from leased facilities. Hyperscalers are projected to power the balance of that capacity in line with industry growth forecasts. High-density AI clusters require not only a dependable electricity supply, which is fundamental to their long-term prosperity, but large contiguous tracts of industrially zoned land.
Challenges persist. Current water scarcity in Indian urban centers like Mumbai, Bengaluru, and Chennai could hamper data center efforts. How these issues come to the forefront will be key. Companies such as CtrlS are putting over a billion dollars into developing strong data center solutions with their “HyperVault” project that aims to create a strong AI infrastructure within India.