Big Tech is doubling down on India despite stalled trade talks and steep tariffs, pouring billions into AI and data centre investments in a sign of the nation’s enduring appeal as a market.
Close on the heels of Microsoft announcing a $17.5 billion investment in India, its rival Amazon wrote a $35 billion cheque to focus on AI, exports and job creation.
Prime Minister Narendra Modi's dream of turning India into an innovation hub for technology got a big thumbs up from the tech titans who have lined up billions to support the semiconductor and AI mission.
The huge potential for turning India into a data hub has fueled the race to build data centres with AI driving the next leg of growth. Hyperscalers are lining up to quickly capitalize on this opportunity with Google committing $15 billion to build its AI and gigawatt data centre facility in Visakhapatnam, the largest outside the US.
Here's a quick lowdown on why the tech moguls are making big-bang investment commitments and the rush to dominate India's tech landscape:
AI future
India is a fast growing market that offers a billion plus internet users along with a strong talent pool to support the AI ambitions of Big Tech. Indian consumer have been the fastest in terms of AI adoption globally. India's vast and diverse population offers the perfect environment for the next big leap for AI models.
Microsoft's Satya Nadella, speaking on its India investment, said it will help build the infrastructure, skills, and sovereign capabilities needed for India’s AI first future. While Microsoft's investment is solely on AI, Amazon's investments are mostly spread across expanding its ecommerce exports, AI and digitalization and job creation.
Cloud competition
Big tech players are competing in the cloud space as they look forward to fast monetise their big ticket investments in AI. India is a big market for cloud services and players like Google, Microsoft and Amazon are witnessing a surge in their cloud computing revenue fueled by rising demand among enterprises for AI products. Data localization rules have driven the spurt among big players to build the capacity locally to host the massive data in Indian servers.
China+1 strategy
The China+1 strategy is also playing an important role in redirecting supply chains as multinational companies favour India due to its English speaking workforce, talented pool of engineers, supportive regulatory environment, and government schemes that are aiding investments.
Big digital push
India's fast growing digital market offers growth opportunities for tech players. India's per capita data consumption is rapidly rising and the demand for data centres will only go up in future. The growth drivers are India's rapidly expanding UPI payment space, ecommerce and quick commerce picking up momentum, telemedicine, gaming, fintech churning out enormous data.
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