Microsoft plans to invest $3 billion to expand its artificial intelligence and cloud Azure services in India, turning to the world’s most populous nation to fuel its revenue growth engine.
The firm, which has been operating in India for more than two decades, will also train an additional 10 million people in the country with AI, Microsoft CEO Satya Nadella said at an event in Bengaluru Tuesday.
“The investments in infrastructure and skilling we are announcing today reaffirm our commitment to making India AI-first, and will help ensure people and organizations across the country benefit broadly,” said Nadella. “The diffusion rate of AI in India is exciting.”
India is a key overseas market for American tech giants that have poured tens of billions of dollars in building and scaling their operations in the South Asian market over the past two decades as they work to court businesses serving hundreds of millions of users.
The competition has intensified among hyperscalers in recent quarters as Microsoft aggressively broadens its offerings with new AI capabilities. E-commerce group Amazon said in 2023 that it planned to invest $12.7 billion in its India business by 2030.
Microsoft, among the top cloud and AI providers in India, operates three datacenter regions in India and plans to make its fourth ready to go live next year, the company said. The $3 billion investment will be deployed to develop a scalable AI computing ecosystem to serve India’s AI startups and research community.
India has also cemented its place on the global map as one of the world’s largest and fastest growing developer markets. More than 17 million of them in India use Microsoft’s Github. A number of tech executives, including Nvidia chief executive Jensen Huang and AMD chief Lisa Su, have visited India in recent months, in part to court developers.
Microsoft also said it has signed an AI memorandum of understanding with SaaSBoomi, a community for B2B startups in India. As part of the collaboration, the two will seek to promote entrepreneurship in smaller Indian cities and towns and also help attract an additional $1.5 billion in VC funding for Indian AI and SaaS startups.
Microsoft is already seeing many of its clients in the South Asian market use its newest technologies to bring efficiencies to their businesses, Nadella said. Some of its clients in India include Infosys, Air India, Meesho, Tech Mahindra, Federal Bank, Apollo, MakeMyTrip, HCL Tech, Manipal, Icertis, and InMobi. IT firm Persistent is using Microsoft 365 Copilot’s “Contract Assist” to reduce negotiation time by 70%, Nadella said.
