Microsoft on Tuesday announced its largest-ever investment in Asia, committing US$17.5 billion (Rs. 1.5 lakh crore approx.) over four years (2026–2029) to expand AI infrastructure, skilling, and operations in India. The announcement follows a meeting between Microsoft Chairman and CEO Satya Nadella and Prime Minister Narendra Modi, where the leaders discussed India’s AI roadmap and growth priorities.
Investment Focus: Scale, Skills, and Sovereignty
The investment builds on a previous US$3 billion commitment and will focus on three areas: cloud and AI infrastructure, workforce skilling, and digital sovereignty solutions. Microsoft aims to enable AI-driven services at population scale, supporting India’s transition from digital public infrastructure to AI public infrastructure.
Microsoft employs more than 22,000 people across Bengaluru, Hyderabad, Pune, Gurugram, Noida, and other cities. Teams contribute to AI development across Microsoft products and platforms, including Copilot Studio, Azure AI Search, AI agents, AI speech and translation services, and Azure Machine Learning.
Expanding India’s AI Infrastructure
A major priority is building secure, sovereign-ready hyperscale infrastructure. The India South Central cloud region in Hyderabad, scheduled to launch in mid-2026, will be Microsoft’s largest hyperscale region in India, spanning three availability zones. Existing data centers in Chennai, Hyderabad, and Pune will also expand, providing organizations with low-latency, resilient performance for enterprises, startups, and public institutions.
AI at Population Scale
Microsoft plans to integrate AI capabilities into the Ministry of Labour and Employment’s digital platforms, e-Shram and the National Career Service (NCS). This initiative targets over 310 million informal workers and offers features including multilingual AI-assisted job matching, predictive skill analytics, automated résumé creation, and personalized pathways toward formal employment.
e-Shram, built on Azure’s cloud, has expanded social protection coverage from 24% in 2019 to 64% in 2025, according to ILO estimates. The integration of AI tools is designed to strengthen digital public infrastructure and improve the accessibility of employment and welfare services.
Building an AI-Ready Workforce
Microsoft has doubled its commitment to train 20 million Indians in AI skills by 2030. Through the ADVANTA(I)GE India initiative, delivered by Microsoft Elevate, 5.6 million people have been trained since January 2025, creating over 125,000 employment or entrepreneurial opportunities.
Sovereign Digital Solutions
To meet compliance and governance requirements, Microsoft introduced Sovereign Public Cloud and Sovereign Private Cloud for Indian customers. These solutions allow organizations to deploy workloads locally with compliance guardrails, policy enforcement, and governance controls.
Azure Local now provides high-performance environments with hundreds of nodes, external SAN storage, and NVIDIA GPUs. Microsoft 365 Local, running on Sovereign Private Cloud, is also available in India. By the end of 2025, Microsoft 365 Copilot will process data entirely within India, ensuring governance, compliance, and performance for sectors including government, BFSI, and healthcare.
Prime Minister Modi Welcomes the Investment
Prime Minister Narendra Modi welcomed the announcement, emphasizing India’s role in global AI development. He stated:
When it comes to AI, the world is optimistic about India! Had a very productive discussion with Mr. Satya Nadella. 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.
Speaking at the event, Shri Ashwini Vaishnaw, Union Minister of Electronics & Information Technology, said,
As AI reshapes the digital economy, India remains committed to innovation grounded in trust and sovereignty. Microsoft’s landmark investment signals India’s emergence as a reliable technology partner for the world. This partnership will set new benchmarks and drive the country’s leap from digital public infrastructure to AI public infrastructure.
Commenting on the development, Puneet Chandok, President, Microsoft India and South Asia, said,
Microsoft has been part of India’s fabric for more than three decades. As the nation moves confidently into its AI-first future, we are proud to stand as a trusted partner in advancing the infrastructure, innovation and opportunity that can power a billion dreams. Building on the US$3 billion investment announced in January 2025, our new US$17.5 billion commitment and deep partnership across India’s technology ecosystem are focused on turning India’s AI ambition into impact for every citizen. This transformation is grounded on three pillars: hyperscale infrastructure to run AI at scale, sovereign-ready solutions that ensure trust, and skilling programs that empower every Indian to not just join the future but shape it.