Microsoft has announced a record $17.5 billion (Rs 1.5 lakh crore) investment in India, its largest-ever commitment in Asia, over the next four years to expand AI infrastructure, deepen cloud capacity and train millions in advanced digital skills. The announcement came shortly after Microsoft CEO Satya Nadella met Prime Minister Narendra Modi in New Delhi to discuss India's growing role in the global AI ecosystem.
PM Modi on Tuesday said on X, “When it comes to AI, the world is optimistic about India… Happy to see India being the place where Microsoft will make its largest-ever investment in Asia. The youth of India will harness this opportunity to innovate and leverage the power of AI for a better planet.”
What Is Microsoft Investing In?
Microsoft says the money will go into three big areas: scale, skills, and sovereignty.
Building More AI Infrastructure
- A massive new data centre region in Hyderabad, going live in 2026, will be Microsoft's largest in India.
- Three more availability zones will be added. Together, they will be as large as two Eden Gardens stadiums.
- Existing data centre regions in Chennai, Hyderabad, and Pune will expand.
- Stronger cloud infrastructure means faster apps, more reliable digital services, and the ability to run advanced AI models inside India.
AI For The Masses
Microsoft is helping integrate AI into two big labour platforms:
- e-Shram - connects informal workers to 18 welfare schemes.
- National Career Service (NCS) - job listings and skilling.
Using Azure and Azure OpenAI Services, these platforms will now get:
- multilingual AI chat support
- AI-assisted job matching
- predictive insights on skills and demand
- automated resume generation
- guidance to move informal workers towards formal jobs
Over 310 million informal workers, especially those with limited education or digital skills, get easier access to welfare, jobs, and training.
Making India An AI-Skilled Nation
Microsoft is focusing hard on AI training.
Key targets:
- Train 20 million Indians in AI skills by 2030.
- Already trained 5.6 million people since January 2025
- Over 1.2 lakh people have already found jobs or started businesses after Microsoft courses.
India has the world's youngest workforce. Big AI projects need huge talent pipelines. If training scales well, this can expand employment in engineering and design, help small businesses adopt AI and improve youth employability across cities and towns.
Sovereign Cloud
Microsoft is introducing:
- Sovereign Public Cloud
- Sovereign Private Cloud (powered by Azure Local)
- Microsoft 365 Local
- Future in-country processing for Copilot data (by 2025 end)
These allow sensitive data from government, banks, healthcare, or public services to stay fully inside India.
Data staying within borders means better compliance, stronger privacy, more control for regulators, and faster and more secure services for sectors like BFSI, health, and public administration.
Strengthening India's Tech Workforce
Microsoft already employs 22,000+ people in India, working across AI model development, engineering, Azure and datacenter operations and global products like Copilot Studio, Azure AI Search, speech & translation tools, and ML platforms. These teams build tech used not only in India but worldwide.
The new investment means more high-value jobs, more R&D happening inside India, and more global products being built from Indian cities.
What Microsoft's Investment Mean For India's AI Future
- Faster, cheaper and more powerful AI - Local datacenters make AI quicker to run, more affordable for startups, and easier for government and industry to adopt.
- A major boost for Digital Public Infrastructure - India moves from DPI to AI-powered public infrastructure, enabling smarter services, personalised welfare delivery, predictive governance and AI tools for education, health and skilling.
- Millions of AI-skilled youth - Large-scale training could make India the world's biggest AI-ready workforce and a global hub for AI development.
- Stronger digital sovereignty - Sensitive data stays within India.
- More opportunities for startups - Startups gain better cloud capacity, easier GPU access, local data processing and compliance-ready platforms to build and scale AI solutions.
