December 10, 2025: India’s rise as one of the world’s most dynamic AI frontiers is becoming louder with Microsoft announcing a US$17.5 billion investment over four years, its largest commitment in Asia. The investment, slated for CY 2026–2029, comes on top of the earlier US$3 billion pledge, which the company says will be fully deployed by the end of 2026.
The announcement followed Microsoft Chairman and CEO Satya Nadella’s meeting with Prime Minister Narendra Modi in New Delhi, where the two leaders discussed India’s evolving AI roadmap and the country’s ambition to scale digital and AI infrastructure nationwide.
A Defining Moment for India’s AI Ambition
India is approaching what policy leaders call a “decisive inflection point” in its AI journey. With its rapidly expanding digital public infrastructure and growing talent base, the country is positioning itself as a global leader in deploying AI at population scale.
“This is our largest investment in Asia, and it reflects our conviction that India is poised to lead in the AI age, not follow it,” Nadella said after the meeting. He emphasized that Microsoft’s partnership with India would “help shape an AI ecosystem that is not only globally competitive but uniquely inclusive.”
Union Minister for Electronics & Information Technology Ashwini Vaishnaw welcomed the announcement, calling it a critical milestone for India’s tech ecosystem.
“As AI reshapes the digital economy, India remains committed to innovation anchored in trust and sovereignty. Microsoft’s landmark investment signals India’s rise as a reliable technology partner for the world,” he said. “This partnership will help build the leap from digital public infrastructure to AI public infrastructure.”
Hyperscale Infrastructure: India to Host Microsoft’s Largest Datacenter Region
A central focus of the investment is the expansion of India’s cloud and AI backbone. Microsoft confirmed that its upcoming Hyderabad-based South Central datacenter region — expected to go live in mid-2026 — will become its largest hyperscale cloud presence in the country, spanning three availability zones and covering an area “roughly the size of two Eden Gardens stadiums combined.”
The company will also expand its existing datacenter regions in Chennai, Hyderabad, and Pune, strengthening disaster resilience and significantly improving low-latency performance for enterprises, developers, startups, and public-sector institutions.
Puneet Chandok, President of Microsoft India and South Asia, said the scale of the investment reflects both urgency and opportunity.
“India is stepping confidently into an AI-first future. Our new US$17.5 billion commitment is about powering that future with infrastructure, innovation, and opportunity for every citizen,” he said. “This transformation rests on three pillars — hyperscale capacity, sovereign-ready solutions, and skilling at population scale.”
AI for 310 Million Informal Workers – Microsoft
One of the announcement’s most transformative initiatives is the integration of Microsoft AI into e-Shram and the National Career Service (NCS) — platforms serving more than 310 million informal workers.
These enhancements, powered by Azure OpenAI Service, bring multilingual interfaces, AI-assisted job matching, predictive insights for skill demand, automated resume building, and tailored pathways toward formal employment.
For a sector often underserved by digital innovation, the move is expected to significantly expand access to welfare, work opportunities, and skill mobility.
“AI can be a great equalizer when delivered responsibly at scale. This is India demonstrating what population-level innovation truly looks like,” a senior Microsoft executive working on the rollout said.
A Massive Push to Build an AI-Ready Workforce
In a significant escalation of its talent development strategy, Microsoft announced it is doubling its skilling commitment — aiming to equip 20 million Indians with AI skills by 2030.
Under the ADVANTA(I)GE India initiative, 5.6 million individuals have already been trained since January 2025. More than 125,000 people have secured jobs or entrepreneurial opportunities through these programs.
Driving Sovereign Digital Infrastructure
With data governance emerging as a central priority for Indian enterprises, Microsoft unveiled new Sovereign Public Cloud and Sovereign Private Cloud offerings designed specifically for regulatory compliance and high-assurance workloads.
These solutions provide granular policy enforcement, governance controls, and in-country data residency. In addition:
- Microsoft 365 Local, running on Sovereign Private Cloud, is now available in India.
- Microsoft 365 Copilot will process prompts and responses entirely within India by the end of 2025.
“Sovereignty is becoming a competitive advantage. We’re building solutions that allow India to innovate boldly while remaining fully compliant,” Chandok said.
A Transformative Bet on India’s Next Decade
With more than 22,000 employees across India, Microsoft says its teams are not only powering India’s digital transformation but also building foundational AI technologies used globally — from Copilot Studio and Azure AI Search to machine learning, speech, and translation systems.
The company believes the next decade will mark India’s transition from a digital-first nation to an AI-powered economic engine.
“What India achieves in AI over the next ten years will influence the world. We’re investing to help make that leap possible, and we believe the impact will be felt across every sector and every community,” Nadella said.
