Microsoft will invest US$17.5 billion in India over four years to expand its cloud and artificial intelligence (AI) infrastructure, scale up skilling programmes and support local operations.
It said this is its largest investment in Asia and follows the US$3 billion announced earlier this year, which is expected to be fully deployed by end-2026.
The announcement came after Microsoft Chairman and CEO Satya Nadella met Prime Minister Narendra Modi to discuss India’s AI roadmap.
When it comes to AI, the world is optimistic about India!
Had a very productive discussion with Mr. Satya Nadella. Happy to see India being the place where Microsoft will make its largest-ever investment in Asia.
The youth of India will harness this opportunity to innovate… https://t.co/fMFcGQ8ctK
— Narendra Modi (@narendramodi) December 9, 2025
Microsoft said the plan aligns with the Prime Minister’s vision of scale, skills and sovereignty, which guides national efforts to build AI capabilities at population level.
Much of the new funding will support data centre expansion, including a hyperscale region in Hyderabad scheduled to go live in mid-2026.
Microsoft will also expand its existing regions in Chennai, Hyderabad and Pune to improve performance for enterprises, startups and public agencies.
The company is working with the Ministry of Labour and Employment to bring AI tools to the e-Shram and National Career Service platforms, which serve more than 310 million informal workers.
The updates include multilingual access, AI-assisted job matching, skills demand forecasting and automated resumé creation.
Through e-Shram, workers are connected to 18 welfare schemes.
Microsoft is doubling its skilling target to 20 million people by 2030.
It said 5.6 million have been trained since early 2025, with more than 125,000 individuals securing jobs or entrepreneurial opportunities through its programmes.
New digital sovereignty offerings, including Sovereign Public Cloud and Sovereign Private Cloud, were also introduced.
Microsoft 365 Copilot will begin processing data within India by the end of 2025, making the country one of the top four global markets to receive in-country data handling for the service.
The company said this will support compliance needs across government, finance and healthcare.
Union Minister Ashwini Vaishnaw said the investment reflects India’s growing role as a global technology partner.
Puneet Chandok, President, Microsoft India and South Asia, said,
“Microsoft has been part of India’s fabric for more than three decades. As the nation moves confidently into its AI-first future, we are proud to stand as a trusted partner in advancing the infrastructure, innovation and opportunity that can power a billion dreams.
Building on the US$3 billion investment announced in January 2025, our new US$17.5 billion commitment and deep partnership across India’s technology ecosystem are focused on turning India’s AI ambition into impact for every citizen.”
Microsoft employs more than 22,000 people across several cities who work on AI development, engineering, data centre operations and customer support.
Featured image: Satya Nadella, chairman and CEO, Microsoft with Prime Minister Narendra Modi
