Global tech giant Microsoft announced on Tuesday that it is investing $17.5 billion in India over the next four years (2026-2029) to drive AI diffusion in the country, with Prime Minister Narendra Modi asserting that the country’s youth “will harness this opportunity to innovate and leverage the power of AI for a better planet”..
“Today we are announcing our largest investment in Asia — $17.5 billion over four years (CY 2026 to 2029) — to advance India’s cloud and artificial intelligence (AI) infrastructure, skilling and ongoing operations. This investment builds on the $3 billion investment announced earlier this year, which we are on track to spend by the end of CY2026,” Microsoft said in a statement.
The announcement came after Microsoft Chairman and CEO Satya Nadella’s meeting here with Prime Minister Modi.
“Thank you, Prime Minister Narendra Modi, for an inspiring conversation on India’s AI opportunity. 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 in a post on X.
Responding to Nadella’s post, PM Modi wrote: “When it comes to AI, the world is optimistic about India!”
“Had a very productive discussion with Mr. Satya Nadella. Happy to see India being the place where Microsoft will make its largest-ever investment in Asia. The youth of India will harness this opportunity to innovate and leverage the power of AI for a better planet,” he posted.
Microsoft said that India stands at a pivotal moment in its AI journey, one defined by impact at scale, determined to lead. As technology becomes a catalyst for inclusive growth and economic transformation, the country is emerging as a frontier AI nation.
Nadella has arrived in India for an AI tour of the country.
In the meeting with PM Modi, both leaders discussed the country’s AI roadmap and growth priorities. Microsoft’s investment in India focuses on three pillars—scale, skills and sovereignty—aligned with the Prime Minister’s vision of building a comprehensive ecosystem that drives AI innovation and access at a national scale, according to the company statement.
The new investment will be used to continue to scale up Microsoft’s cloud and AI infrastructure, skilling initiatives and ongoing operations across India. This includes the company’s workforce of more than 22,000 employees across Bengaluru, Hyderabad, Pune, Gurugram, Noida and other cities — representing the diversity of Microsoft’s businesses. They drive every part of its product cycle, from model development to engineering and product innovation. Their work contributes to innovation across Microsoft’s AI stack — from infrastructure to app platforms to products — while operating hyperscale datacenters and delivering sales and support to customers nationwide. These teams are not only powering India’s digital transformation but also delivering AI impact at scale globally —Copilot Studio, Azure AI Search, AI agents, AI speech and translation, Azure Machine Learning and more. Every day, they collaborate closely with India’s leading enterprises, developers and institutions to unlock the promise of AI for the country, according to the Microsoft statement.
One of the key priorities of the Microsoft investment is building secure, sovereign-ready hyperscale infrastructure to enable AI adoption in India. At the heart of this effort is the significant progress being made at the India South Central cloud region, based in Hyderabad, that is set to go live in mid-2026. This will be our largest hyperscale region in India, comprising three availability zones — roughly equivalent in size to two Eden Gardens stadiums combined, the statement said.
The company said it will also continue to expand the three existing operational data centre regions in Chennai, Hyderabad and Pune. This expansion provides organisations across India greater choice and resilience, enabling low-latency, mission-critical performance for enterprises, startups, and public sector institutions.
Union Minister of Electronics & Information Technology Ashwini Vaishnaw said: “As AI reshapes the digital economy, India remains committed to innovation anchored in trust and sovereignty. Microsoft’s landmark investment signals India’s rise as a reliable technology partner for the world. This partnership will set new benchmarks and drive the country’s leap from digital public infrastructure to AI public infrastructure.”
Microsoft India and South Asia President Puneet Chandok said: “Building on the $3 billion investment announced in January 2025, Microsoft’s new $17.5 billion commitment and deep partnership across India’s technology ecosystem are focused on turning India’s AI ambition into impact for every citizen. This transformation is anchored on three pillars: hyperscale infrastructure to run AI at scale, sovereign-ready solutions that ensure trust, and skilling programs that empower every Indian to not just join the future but shape it.”
(With inputs from IANS)
