Why US tech giants are pouring $67.5 billion into India’s AI and data centre boom

At the heart of this push is India’s scale. The country generates nearly a fifth of the world’s data but hosts only a small share of global data storage infrastructure.

• US tech giants to invest $67.5 billion in India's AI and data centre sector
• Tech giants boost investments as India's digital sector grows.
• India's data localisation policies boost infrastructure projects amid trade tensions

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US technology giants are investing tens of billions of dollars into India as the country positions itself as a key global hub for data centres and artificial intelligence infrastructure, according to a report by The New York Times.

Companies such as Microsoft, Amazon, Google, and Meta are ramping up investments to meet the growing global demand for computing power and data storage, with India emerging as a strategic choice due to its vast digital user base and increasing appetite for AI-driven services.

Who is investing and how much

Microsoft has committed $17.5 billion to AI-related projects in India, while Amazon plans to invest $35 billion over the next five years to scale up AI-powered operations nationwide.

Google has pledged $15 billion to develop data centres in partnership with Adani Group and Bharti Airtel. Meta is setting up a large facility close to Google’s proposed sites, alongside several other projects being driven by domestic conglomerates.

Together, these commitments amount to at least $67.5 billion, making it one of the largest capital inflows into a single sector in India’s history. “This is going to be one of the largest single-sector investments that India’s ever seen,” Somnath Mukherjee, Chief Investment Officer at ASK Wealth Advisors in Mumbai, told The New York Times.

Why India matters to Big Tech

At the heart of this push is India’s scale. The country generates nearly a fifth of the world’s data but hosts only a small share of global data storage infrastructure.

“India is the largest consumer of data in the world, but with barely five per cent of American data capacity,” Mukherjee said.

For Big Tech, this gap presents both a challenge and an opportunity. Building data centres closer to users lowers costs, improves speed and strengthens control over data flows.

Data localisation and policy push

India has been debating data localisation rules since 2018, as policymakers seek to reduce reliance on overseas servers. Several sectors, including banking and messaging services, already operate under local data storage norms, with wider mandates still under discussion.

These policy signals have added momentum to long-term infrastructure investments by global technology firms.

Trade tensions, but investments continue

The surge in investment comes despite ongoing trade tensions between Washington and New Delhi, including high tariffs announced by the US earlier this year.

According to the report, strategic priorities around data, artificial intelligence and long-term market growth appear to be outweighing short-term geopolitical frictions.

New data centre hubs are emerging across India, particularly in coastal regions and cities such as Hyderabad. The city has attracted major projects by offering policy incentives, dependable power supply and improved access to water.

Opportunities and challenges ahead

For India, the inflow of capital represents a bid to firmly anchor itself in the global digital economy. However, concerns around land availability, electricity consumption and water usage remain key challenges that could influence how quickly and sustainably the country’s AI and data centre ambitions are realised.