Big tech companies are pumping huge amounts of money into India right now. Microsoft and Amazon alone have promised more than $50 billion in less than 24 hours, all aimed at building out the country’s cloud computing and artificial intelligence infrastructure.
Microsoft said on Tuesday that it would invest $17.5 billion over four years. The money will go toward building massive data centers, introducing artificial intelligence into government systems, and training people for technology jobs. Amazon came right behind them on Wednesday, advertisement More than $35 billion in new investment on top of the $40 billion they’ve already spent there. Intel too I entered At the event on Monday, it said it wanted to manufacture computer chips in India to capitalize on growing sales of personal computers and the rapid adoption of artificial intelligence.
India does not have its own big AI model like the US and China. It also lacks a major local AI infrastructure company. But the country has a different plan: to use its deep pool of IT talent to build and deploy AI applications for businesses. Here lies the real opportunity for American technology companies.
S works. Krishnan is Secretary in the Indian Ministry of Electronics and Information Technology. He told CNBC that simply having computational power or models is not enough. “It takes companies that make the application layer and a large pool of talent to deploy it,” he said.
India is already doing well in the world of AI. Stanford University places it among the top four countries in AI activity, right with the United States, China, and the United Kingdom. On GitHub, where developers share their work, India actually Rows Number one. The country represents 24% of all projects on the platform worldwide.
Krishnan believes India’s best asset is “developing applications” that can generate money for AI companies.
Microsoft gains first mover advantage
Tarun Pathak works as a Research Director at Counterpoint Research. Microsoft’s huge spending is believed to give them a head start. “This amount of capital expenditure gives… Microsoft He explained that it has the advantage of leading in GPU-rich data centers while making Azure the platform of choice for AI workloads in India, as well as deepening alignment with public AI infrastructure provided by the government.
And it’s not just the infusion of money from Microsoft and Amazon. Over the past few months, OpenAI, Google, and Perplexity have given millions of Indians free access to their tools. As reported Cryptopolitan Previously, Google is also going ahead with its plans to spend $15 billion on data center capacity to set up a new AI hub in South India.
Why India? Pathak says it’s very simple. “India combines a huge digital user base, rapidly growing demand for cloud and AI, and a high-talent IT ecosystem that can build and use AI at scale, making it more than just a user market and instead an essential engineering and deployment hub.”
Building data centers in India makes a lot of sense right now. Other markets in the Asia-Pacific region such as Japan, Australia, China and Singapore are basically full. Singapore, a hub for data centers for years, no longer has much space for large new facilities.
India has tons of land for large data centers. Energy costs there are lower than in European data centers. Add to that India’s growing renewable energy capabilities – which power-hungry data centers really need – and the numbers start to look good.
There is strong domestic demand as well. Online shopping has been driving data center growth for years. The new rules may also force social media companies to store data within India, which would create more need.
A perfect storm of growth factors
All this puts India in a good position. Global cloud companies, AI players, and local digital growth are coming together at once, creating one of the hottest data center markets anywhere.
Deepika Giri is Associate Vice President and Head of Big Data and AI Research at International Data Corporation. She describes India as critical. “India is a pivotal market and one of the fastest growing regions for AI spending in the Asia Pacific region,” she said. The biggest gap now? “A big gap, and therefore a big opportunity, lies in the lack of suitable computing infrastructure to run AI models.”
Technology companies are spreading outside traditional regions as well. They are approaching IT cities like Bangalore, Hyderabad and Pune instead of just Mumbai and Chennai, which are located near the landing points of undersea cables. Krishnan says these companies are building data centers in India to serve customers around the world, not just locally.
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