BENGALURU: Microsoft on Tuesday announced a sweeping $23 billion investment package to accelerate artificial intelligence development worldwide, with the largest share — $17.5 billion — dedicated to expanding its presence in India, one of the world’s fastest-growing digital markets.
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CEO Satya Nadella said the investment marks Microsoft’s biggest-ever commitment in Asia and builds on the $3 billion pledged earlier this year. The funds will be deployed over four years beginning in 2026, positioning Microsoft as the dominant cloud-computing provider in India.
With nearly one billion internet users and a vast pool of tech talent, India has become a strategic hub for US technology companies racing to build AI infrastructure. Data centres are central to that strategy, especially as India’s chip manufacturing capacity remains limited.
Google announced in October that it would invest $15 billion over five years to establish an AI data centre in Andhra Pradesh — its largest pledge in the country.
Nadella said Microsoft’s spending will “help build the infrastructure, skills, and sovereign capabilities needed for India’s AI-first future,” in a post on X that included a photo with Prime Minister Narendra Modi.
The Microsoft chief is on a three-day visit to India for the company’s AI conferences, with events scheduled in New Delhi, Bengaluru, and Mumbai.
The latest major outlays from global tech giants come as the US and India navigate trade tensions, stalled negotiations, and disputes over tariffs.
Canada expansion
Earlier on Tuesday, Microsoft announced it would invest more than C$7.5 billion ($5.42 billion) in Canada over the next two years as part of a broader C$19 billion investment plan through 2027. The spending will expand Azure Local cloud capacity in the country, with new operations expected to come online in the second half of 2026.
Microsoft is also deepening its partnership with Toronto-based AI startup Cohere, integrating its advanced AI models into the Azure platform.
Major US cloud providers are expected to spend over $400 billion on AI infrastructure this year alone, driven by demand for tools like ChatGPT, Copilot, and Gemini. But concerns are rising about a potential AI bubble amid high valuations and limited evidence of widespread productivity gains.
Data centre boom in India
Microsoft confirmed it will build a massive hyperscale data centre in Hyderabad — its largest in India — slated to go live in mid-2026. The company will also expand existing regions in Chennai, Hyderabad, and Pune, while doubling its commitment to equip 20 million Indians with AI skills by 2030.
India’s total data centre capacity is projected to triple to around 4.5 gigawatts by 2030, according to consultancy Colliers. For context, one gigawatt of computing power can supply electricity to roughly 750,000 US households.
Microsoft currently employs more than 22,000 people in India and about 5,300 in Canada.
The company has also recently announced $10 billion in AI infrastructure investments in Portugal and $15 billion in the United Arab Emirates.
