Microsoft is significantly expanding its commitment to India's technological advancement with a \$17.5 billion investment over the next four years, spanning from 2026 to 2029. This substantial financial injection, the largest ever for Microsoft in Asia, aims to bolster the country's cloud and artificial intelligence (AI) infrastructure, enhance digital skills, and support ongoing operations.

The announcement, made after a meeting between Microsoft CEO Satya Nadella and Indian Prime Minister Narendra Modi, underscores India's growing importance as a global technology and innovation hub. Both leaders expressed optimism about India's potential to lead in the AI revolution, with Modi stating, "When it comes to AI, the world is optimistic about India".

This investment builds upon a previous commitment of \$3 billion announced in January 2025, which is on track to be spent by the end of 2026. Microsoft's focus is aligned with the Indian government's vision of building a comprehensive ecosystem that drives AI innovation and accessibility on a national scale. The investment strategy rests on three key pillars:

• Hyperscale Infrastructure: A significant portion of the investment will be directed towards building secure, sovereign-ready hyperscale infrastructure to enable widespread AI adoption across India. This includes a new data center region in Hyderabad, slated to go live in mid-2026, which will be Microsoft's largest in India. This data center will feature three availability zones and will be as large as two Eden Garden stadiums. Existing data center regions in Chennai, Hyderabad, and Pune will also be expanded.
• Skilling Programs: Microsoft aims to equip 20 million Indians with essential AI skills by 2030, doubling its previous commitment. These skilling initiatives will involve collaborations with the government, industry, and digital public platforms to ensure equitable access to opportunities. Microsoft's ADVANTA(I)GE India program has already trained 5.6 million people since January 2025, with over 125,000 participants securing jobs or starting businesses.
• Sovereign-Ready Solutions: Microsoft is committed to providing solutions that meet India's specific needs, including data security and regulatory compliance. This includes integrating advanced AI capabilities into public platforms like e-Shram and the National Career Service (NCS). These integrations aim to extend the benefits of AI to over 310 million informal workers, providing services like multilingual access, AI-powered job matching, and predictive analytics.

This investment is expected to have a wide-ranging impact on India's technology sector and economy. India's technology sector is projected to reach \$282.6 billion in 2025, and more than \$300 billion in 2026. By 2030, projections estimate a potential \$350 billion valuation, spurred by digital transformation, innovation, and government initiatives. The IT services market in India is expected to grow at a CAGR of 11.1% between 2024 and 2029. Microsoft's investment is poised to accelerate this growth, creating new opportunities for businesses and individuals alike.

The expansion of cloud infrastructure will lead to faster applications, more reliable digital services, and the ability to run advanced AI models within India. The focus on AI skilling will create a larger pool of talent, driving innovation and entrepreneurship. The development of sovereign cloud services will ensure data security and compliance, fostering trust and confidence in the digital ecosystem.

Microsoft's \$17.5 billion investment is a strong indicator of India's growing importance in the global technology landscape. This commitment not only strengthens Microsoft's presence in the region but also contributes significantly to India's ambition to become a leader in AI and digital innovation.