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Microsoft and Amazon Boost AI Infrastructure in India

Microsoft and Amazon invest billions in India's AI infrastructure, boosting tech capabilities and addressing environmental challenges
June 18, 2024

India is poised to become a global AI leader with investments from tech giants Microsoft and Amazon. Microsoft plans to invest $3.7 billion in data centers in Telangana, providing 660 megawatts of IT capacity, enough to power half a million European households annually. This move aligns with India's ambition to strengthen its AI capabilities and leverage its growing tech market.

The Indian government's initiatives, including the IndiaAI initiative launched in April 2024, aim to enhance computing infrastructure, improve data management through the National Data Management Office (NDMO), and promote research and innovation in AI. This collaboration with private sectors is expected to establish India as a significant player in AI and maximize its demographic dividend.

This year alone, Microsoft, Amazon, and Google have committed $85 billion to data center infrastructure worldwide, with a significant portion earmarked for India. Puneet Chandok, Microsoft’s president for India and South Asia, highlighted India as one of the most exciting tech markets. The investments are set to propel India to the top for self-built data center capacity in the Asia-Pacific region, underscoring its importance as a market for AI and cloud computing.

India's digital economy has rapidly expanded due to widespread smartphone use and affordable data. The government has attracted tech companies with substantial incentives, especially in states like Telangana. Microsoft’s research and development operations in India are the largest outside the US, with two-thirds of its 23,000 employees in the country being engineers. One in four AI projects on GitHub, Microsoft’s coding platform, is managed in India.

However, the environmental impact of data centers, which consume large amounts of electricity and water, poses a challenge. India’s power generation is still largely coal-dependent, despite significant investments in renewable energy, according to FT. Microsoft, committed to becoming carbon-negative by 2030, has signed agreements to source clean power in India from renewable energy companies.

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