Microsoft deepens India AI play with Hyderabad cloud region

Hyderabad: Microsoft on Monday formally launched its fourth India cloud region in Hyderabad as part of its $20.5-billion investment commitment to the country’s digital and AI infrastructure.

The India South Central region, which became generally available on August 6, joins Microsoft’s existing regions in Pune, Chennai and Mumbai.

The Hyderabad facility uses effectively zero water for cooling, relying on air-cooled chillers instead of traditional water-based systems, Microsoft India and South Asia President Puneet Chandok said.

He said India currently has about 2 GW of data centre capacity, which is expected to rise to 6-7 GW by 2035, with more than $100 billion in investments already committed.

India would emerge as an AI infrastructure hub not just for itself but also for Asia and the Global South, Chandok said.

Microsoft Vice Chair and President Brad Smith said the new region would give organisations in India and across Asia more capacity, resilience and choice.

The launch comes amid rapid growth in India’s cloud and AI markets. According to IDC, India’s public cloud services spending is forecast to reach $45.7 billion by 2030, growing at an annual rate of 22.2 per cent, while AI spending is expected to grow at twice that pace. Meanwhile, the government asked Microsoft to locate future data centres closer to power generation sources rather than cable landing stations.

Electronics and IT Secretary S Krishnan said locating facilities near power sources would be more economical for both Microsoft and the country than building them near coastal cable landing hubs such as Chennai.

“It will be much more economical if you go closer to where the power itself is generating,” he said, adding that the government would facilitate faster approvals.

Krishnan said the launch would strengthen India’s data centre and AI infrastructure, while the country needs to build domestic and sovereign computing capacity alongside accessing global technology.

He said India’s 1.4-billion population and growing digital public infrastructure generate large volumes of data, creating a “treasure house” for AI applications and giving the country potential to become “the application powerhouse of the world”.