Microsoft Announces $3 Billion Investment to Expand Azure in India

Microsoft CEO Satya Nadella announced Microsoft’s largest investment in India yet, a $3 billion commitment to expand Azure’s infrastructure in the country, at the Microsoft AI Tour in Bengaluru on Tuesday. The investment will scale Microsoft’s regional cloud infrastructure to bolster AI and computing capabilities.

Emphasising the importance of infrastructure for AI innovation, Nadella said, “AI doesn’t sit on its own; it requires the entire compute stack.” He highlighted that Microsoft has built over 60 regions and 300 data centres worldwide, including existing regions in Central India, South India, and West India.

The additional investment is set to scale up Microsoft’s data centre operations across India. Speaking about the importance of infrastructure in AI development, Nadella said, “Infrastructure needs to be the highest priority, and we are innovating at every layer of it.”

Moreover, Microsoft will train 10 million people in AI by 2030 as a part of its ADVANTA(I)GE INDIA initiative. 

Microsoft recently announced that it is projected to invest approximately $80 billion in FY 2025 globally to establish AI-enabled data centres for training AI models and deploying AI and cloud applications worldwide.

Nadella also shared insights from his meeting with Prime Minister Narendra Modi, who discussed India’s vision for an AI-driven future. Nadella praised the synergy between India’s AI mission, the entrepreneurial ecosystem, and its demographics, describing them as elements of a “virtuous cycle”.

“Thank you, PM Narendra Modi ji, for your leadership. Excited to build on our commitment to making India AI-first and work together on our continued expansion in the country to ensure every Indian benefits from this AI platform shift,” Nadella said in a post on X.

“It was indeed a delight to meet you, Satya Nadella! Glad to know about Microsoft’s ambitious expansion and investment plans in India. It was also wonderful discussing various aspects of tech, innovation and AI in our meeting,” PM Modi replied.

Moreover, the CEO outlined a new metric for evaluating AI and compute efficiency, which he described as “tokens per dollar per watt”. Linking this to broader economic growth, he said, “Two years from now, five years from now, 10 years from now, we will be talking about the correlation between GDP growth and how efficiently communities and industries drive that equation.”

As part of its expansion, Microsoft plans to integrate renewable energy and advanced engineering practices to make its data centres more sustainable. Nadella highlighted innovations such as liquid-cooled AI accelerators, zero-waste construction, and zero-water usage facilities.

Nadella is currently touring India as part of the Microsoft AI Tour, where he spoke in Bengaluru on January 7 and will also speak in Delhi on January 8. Last week, he met with Telangana Chief Minister K Chandrashekar Rao in Hyderabad to discuss the state’s technology priorities, including AI, generative AI, and cloud development.

Microsoft India employs over 20,000 people across 10 cities, including Ahmedabad, Bengaluru, Chennai, Gurugram, Delhi, Noida, Kolkata, Mumbai, and Pune, with Hyderabad alone accounting for half the workforce at 10,000 employees.

For the fiscal year ending March 30, Microsoft’s India business posted a 38.44% increase in net profit year over year, driven by the steady growth in cloud adoption and AI.