India is seeing a significant increase in private-sector investments in artificial intelligence (AI), creating a noticeable gap between public and private funding that is shaping the country’s technological direction. The government’s IndiaAI Mission aims to enhance computing power, boost research, and support the development of AI models, but its financial plans are quickly being outpaced by the large investments from global tech companies. This growing difference is not just about money; it also affects who will own, manage, and control the important AI and cloud infrastructure that will be vital for India’s digital future.
The rise in private investment is fueled by India’s unique strengths. The country generates nearly one-fifth of the world’s data, has one of the largest young populations, and is rapidly adopting digital technologies across various devices and cloud services. These factors make India a key market for training, deploying, and scaling advanced AI systems, prompting international companies to invest long-term.
As a result, foreign firms are quickly establishing large-scale infrastructure and gaining control over essential platforms that local businesses and public institutions will depend on. This shift may affect the development of India’s AI ecosystem, raising concerns that market forces, rather than public interests, could dictate access, affordability, and standards. For India to achieve widespread AI adoption and maintain technological independence, it will need ongoing public investment in open computing, foundational research, and responsible data management.
Major Investment Announcements
In December 2025, two leading global technology companies announced substantial multi year investments in India, totaling over $50 billion, further solidifying the country’s role as a strategic technology hub.
On December 9, 2025, Amazon announced plans to invest more than $35 billion in India by 2030, building on nearly $40 billion already invested in previous years. This announcement was made during the Amazon Smbhav Summit in New Delhi.
On the same day, Microsoft revealed a $17.5 billion investment—its largest in Asia— covering the period from 2026 to 2029. This investment will focus on expanding AI and cloud infrastructure while enhancing operational capabilities in India. Both announcements underscore India’s growing significance in the global technology sector.
Investment Focus Areas
Amazon’s investment will be directed towards several key areas, especially AI-driven digitization, boosting exports, and creating jobs nationwide. The company also plans to increase its investments in fulfilment centres, logistics, data centres, and digital payment systems. Amazon aims to raise total exports to nearly $80 billion by 2030 and expand AI tools for millions of small businesses across India.
Microsoft’s strategy emphasizes improving cloud and AI capabilities, developing solutions that comply with India’s data governance policies, and significantly enhancing skills training. The company will expand its hyperscale data centre presence, including a new major region in Hyderabad expected to be operational by 2026. Additionally, Microsoft plans to train 20 million Indians in AI skills by 2030 and integrate advanced AI into public platforms like eShram and the National Career Service.
AI and Data-Centre Boom
Deloitte predicts that India’s data centre market could reach $100 billion by 2027. Japanese company NTT DATA has also announced a $1.5 billion investment to increase data centre capacity in the country.
At the same time, leading AI companies are forming strategic partnerships to broaden access to premium AI tools, with telecom giants like Reliance Jio and Bharti Airtel providing free access to certain AI models and subscriptions for Indian users.
Public Investment Context
The IndiaAI Mission is the government’s main AI initiative, with a total budget of ₹10,371 crore over five years. However, actual spending has been limited in the early years. For 2025–26, the government allocated ₹2,000 crore, along with specific funds for expanding computing capabilities and developing indigenous models. When compared to the recent multi-billion-dollar investments from foreign technology firms, the difference in scale is clear.
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