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Microsoft opens its largest India data center hub as AI race heats up

By Thomson Reuters Aug 6, 2026 | 7:33 AM

Aug 6 (Reuters) – Microsoft launched its largest India data center in Hyderabad on Thursday and has signed up Adani Group and HDFC ​Bank among early users as it races ‌rivals for the country’s fast-growing AI market.

The India South Central facility brings Microsoft’s cloud regions in India to four, adding to existing centers in Pune, Chennai and Mumbai, and ‌cementing ​its position as the country’s ⁠largest cloud-computing provider,

The Windows ⁠maker has committed about $20.5 billion to expand its India opreations, betting on a market of more than 1 billion internet users and one ​of the world’s deepest pools of tech talent.

Here are more details:

• Azure, Microsoft’s cloud-computing arm, has ⁠posted double-digit revenue increases in ⁠India for the last two years, ​the company said.

• Microsoft also operates two data centers ​in the South Asian nation with Indian ‌billionaire Mukesh Ambani’s Jio.

• Creating value with AI “requires trusted infrastructure close to where data lives, teams work and decisions are made,” said Microsoft India President ⁠Puneet Chandok, adding the new facility “is a critical part of that foundation”

• Rivals Alphabet and Amazon are also pouring ⁠money into ‌data center capacity in India, drawn ⁠by the country’s large potential pool ​of ‌AI users.

• Not all of those ​efforts have ⁠gone smoothly. Environmentalists have accused authorities of fast-tracking a planned Google data center hub in India without weighing risks to water supplies and wildlife, allegations the government rejects.

(Reporting by Aditya Soni in Bengaluru; Editing by ​Tasim Zahid)