Google is aggressively investing in artificial intelligence (AI) to challenge the cloud computing dominance of Microsoft and Amazon in the rapidly expanding Indian market. This strategic move involves substantial financial commitments, infrastructure expansion, and collaborations with local institutions to foster AI innovation tailored for India's unique needs.
Recognizing India's burgeoning demand for cloud services and AI, Google has pledged approximately $15 billion (USD) over the next five years (2026-2030) to establish its first AI hub in Visakhapatnam, Andhra Pradesh. This multifaceted investment encompasses gigawatt-scale data center operations, new energy sources, and an expanded fiber-optic network. Matt Renner, President of Global Revenue at Google Cloud, emphasized that this hub aims to meet the rising local demand for sovereign data and AI solutions, highlighting India as a key growth market.
To further strengthen its AI capabilities in India, Google Cloud is significantly increasing its local compute capacity through its AI Hypercomputer architecture, powered by Trillium TPUs. This expansion enables businesses and public sector organizations to train and deploy advanced Gemini models locally, addressing data residency and sovereignty requirements while reducing latency for AI applications. Google Cloud is also providing early access to its most advanced Gemini models to Indian customers with full data residency support, a first for the company. The deployment includes Gemini 2.5 Flash with batch processing capabilities, Document AI for automating document workflows, and grounding features using Google Maps for location-aware responses.
Google is also actively collaborating with the Indian government to support its "Viksit Bharat 2047" vision and the IndiaAI mission. This includes offering subsidized compute infrastructure to startups and researchers and partnering with Indian telcos like Airtel to offer sovereign cloud services. Bikram Singh Bedi, Vice President and Country MD at Google Cloud India, stated that Google Cloud aims to unveil all layers of its AI stack in India and deepen its engagement with the government.
In addition to infrastructure investments, Google is focusing on nurturing AI talent and fostering innovation within India. Google Cloud and Google DeepMind have partnered with IIT Madras to launch Indic LLM-Arena, an independent evaluation platform operated by the AI4Bharat center. This platform uses crowd-sourced, blind comparisons where users submit prompts in any Indian language and vote on responses from anonymous AI models. Mitesh Khapra, associate professor at IIT Madras, emphasized that Indic Arena will be a platform for standardized benchmarking across India's multilingual landscape, addressing critical gaps in current AI evaluation.
Google's commitment to India's AI ecosystem extends beyond infrastructure and talent development. The company is also tailoring its AI tools and services to meet the specific needs of the Indian market. This includes launching a suite of new capabilities with data residency support in India, such as batch support for Gemini 2.5 Flash and Document AI.
While Google is making significant strides in India's AI landscape, it faces stiff competition from established players like Microsoft and Amazon Web Services (AWS). Microsoft has announced a $3 billion investment to expand its Azure and AI capabilities in India, with plans to train 10 million people in AI skills by 2030. AWS is also heavily invested in India, with plans to invest $12.7 billion by 2030 to expand cloud infrastructure and bolster its generative AI capabilities.
Despite the competition, Google's strategic investments, focus on local needs, and collaborations with government and academic institutions position it as a strong contender in India's rapidly growing AI market. The India cloud AI market is projected to reach $56.8 billion by 2030, growing at a CAGR of 52.6% from 2025 to 2030, presenting a significant opportunity for Google to gain market share and establish itself as a leader in AI and cloud computing in India.
