- Microsoft to open largest data centre in Hyderabad by mid-2026
- The facility aims to meet growing demand for Azure cloud and Copilot AI
- Microsoft plans $17.5 billion investment in India, focusing on data centres
In a major boost to India's fast-expanding artificial intelligence and cloud infrastructure ecosystem, Microsoft is set to operationalise its largest data centre in the country by mid-2026, Reuters reported on Tuesday.
According to Puneet Chandok, President of Microsoft India and South Asia, the facility is coming up in Hyderabad and will be Microsoft's largest data centre in India.
“There's massive demand for Azure cloud services and the company's $30-per-month Copilot 365 AI assistant in India,” Chandok told Reuters.
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The development comes as Microsoft sharpens its AI push in one of the world's fastest-growing digital markets, banking on India's vast internet user base and deep pool of technology talent.
Rivals Alphabet and Amazon are also expanding aggressively in the country's AI and cloud ecosystem.
Microsoft had announced late last year that it would invest $17.5 billion in India — its biggest investment in Asia — in addition to the $3 billion commitment made earlier in 2025.
A major portion of the investment is being directed toward expanding data centre infrastructure, including the Hyderabad facility.
“We are the ones who are bringing this to life quickly, the fastest out of the gates,” Chandok said while referring to Microsoft's data centre expansion plans.
However, he did not disclose the exact capacity of the upcoming facility.
According to the report, the additional infrastructure will support rising demand for Copilot services among major Indian IT companies, including Infosys, Cognizant and Tata Consultancy Services, each of which reportedly holds around 50,000 Copilot licences.
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Chandok also highlighted that several AI features being rolled out globally by Microsoft are being developed in India, where the company employs more than 22,000 people across multiple cities.
He acknowledged that hiring skilled AI professionals is becoming increasingly challenging amid soaring global demand.
“The challenges in India are the same as everywhere else in the world,” Chandok said, describing the situation as a growing “war for talent.”
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