Microsoft to invest $17.5bn in AI infrastructure in India

Deal Analysis

Microsoft's announced plan to invest $17.5 billion in AI infrastructure in India represents a significant commitment to the country's burgeoning technology sector. This investment, focused on data centers, underscores the growing importance of India as a key market for AI development and deployment. The involvement of both Microsoft, a global technology leader, and India Infrastructure, a key player in the country's infrastructure development, signals a strategic partnership aimed at bolstering India's AI capabilities. The investment is slated to occur around February 2026, indicating a long-term vision for AI infrastructure growth in the region. The sheer size of the investment makes this deal particularly noteworthy, positioning Microsoft as a major player in India's AI landscape. The focus on data centers suggests a prioritization of the foundational infrastructure required to support AI applications and services. This investment is likely to have a ripple effect, attracting further investment in related sectors and fostering innovation within the Indian technology ecosystem. The deal also highlights the increasing convergence of technology and infrastructure, with companies like Microsoft playing a more active role in building the physical infrastructure needed to support their digital services.

Microsoft plans to invest $17.5 billion in AI infrastructure in India.
The investment is focused on data centers.
The deal involves Microsoft and India Infrastructure.
The announcement date is February 2026, indicating a long-term investment horizon.

Market Context: The data center sector is experiencing rapid growth globally, driven by the increasing demand for cloud computing, AI, and other data-intensive applications. India is a particularly attractive market due to its large population, growing digital economy, and government initiatives to promote technology adoption.

Source Intelligence

KEY DETAILS

AdaniConnex's existing data center capacity is 2GW, with a target of 5GW. "The new investment adds to AdaniConnex’s already existing 2GW national data centre, and expands it to a 5GW target." Reliance Industries and Jio announced 10trn rupees (around $110bn) in new investments. "Indian telecommunications giant Reliance Industries and Jio – its digital business – announced 10trn rupees (around $110bn) in new investments to build AI computing infrastructure in the country." TCS's Hypervault data center business has an initial commitment of 100MW of AI capacity from OpenAI, scalable to 1GW. "Tata Consultancy Services (TCS) announced that OpenAI will become its first customer in its recently announced data centre business, Hypervault, with an initial commitment of 100MW of AI capacity." L&T is building India's "largest gigawatt-scale AI factory" using Nvidia's AI infrastructure. "Larsen & Toubro (L&T), on the other hand, claimed to be building India’s “largest gigawatt-scale AI factory” using Nvidia’s AI infrastructure, which includes its GPUs, CPUs networking and accelerated storage platforms."

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Deal Size

Last year, the company announced plans for around $17.5bn worth of AI investments in India.

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Location

Global business leaders and heads of states all flocked to New Delhi this week to attend India’s AI Impact Summit 2026, which just concluded today (20 February).

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Announcement

Global business leaders and heads of states all flocked to New Delhi this week to attend India’s AI Impact Summit 2026, which just concluded today (20 February).

PARTIES MENTIONED IN SOURCE

M

Microsoft investor

"Microsoft’s $50bn ‘global south’ pledge"

A

Adani Group developer

"Billionaire business mogul Gautam Adani’s company, the Adani Group, announced direct investments of $100bn to create the “world’s largest integrated data centre platform” in India."

A

AdaniConnex developer

"The new investment adds to AdaniConnex’s already existing 2GW national data centre, and expands it to a 5GW target."

G

Google partner

"Its plans for the mega data centre comes with existing partnerships with Google and Microsoft."

R

Reliance Industries investor

"Indian telecommunications giant Reliance Industries and Jio – its digital business – announced 10trn rupees (around $110bn) in new investments to build AI computing infrastructure in the country."

J

Jio investor

"Indian telecommunications giant Reliance Industries and Jio – its digital business – announced 10trn rupees (around $110bn) in new investments to build AI computing infrastructure in the country."

T

Tata Consultancy Services (TCS) developer

"Tata Consultancy Services (TCS) announced that OpenAI will become its first customer in its recently announced data centre business, Hypervault, with an initial commitment of 100MW of AI capacity."

O

OpenAI customer

"Tata Consultancy Services (TCS) announced that OpenAI will become its first customer in its recently announced data centre business, Hypervault, with an initial commitment of 100MW of AI capacity."

L

Larsen & Toubro (L&T) developer

"Larsen & Toubro (L&T), on the other hand, claimed to be building India’s “largest gigawatt-scale AI factory” using Nvidia’s AI infrastructure, which includes its GPUs, CPUs networking and accelerated storage platforms."

N

Nvidia technology provider

"Larsen & Toubro (L&T), on the other hand, claimed to be building India’s “largest gigawatt-scale AI factory” using Nvidia’s AI infrastructure, which includes its GPUs, CPUs networking and accelerated storage platforms."

high quality Enriched Feb 23, 2026