Technology | India Plans Massive AI 'Data City' in Andhra Pradesh with $175 Billion Investment

India today announced plans for a vast new 'data city' in Visakhapatnam, Andhra Pradesh, to significantly boost its artificial intelligence (AI) capabilities. This ambitious initiative has already secured an estimated $175 billion in investment agreements from global tech giants, according to state officials. 2, 4, 7, 8, 9, 13

Visakhapatnam to Anchor India's AI Ambitions

The proposed 'data city' in Visakhapatnam, often referred to as Vizag, is envisioned as a central hub for India's artificial intelligence ambitions, designed to attract global capital, computing power, and influence into the country. 4 The plan involves establishing a comprehensive data ecosystem spanning a 100-kilometre radius around the city. 4, 5, 7, 9, 13 This includes the development of hyperscale data centres, manufacturing units for servers and cooling systems, and enhanced connectivity through new undersea internet cables that will link India directly to Southeast Asia, particularly Singapore. 4, 5, 7, 8, 9, 13 Visakhapatnam's coastline is being strategically positioned as a landing point for these crucial submarine cables. 4, 5, 7, 8, 9, 13

Substantial Investment from Global Tech Giants

Andhra Pradesh's Information Technology Minister, Nara Lokesh, stated that the state has signed investment agreements totaling $175 billion (approximately ₹14.5 lakh crore) across more than 700 projects. 4, 7, 8, 9, 13 Among the major commitments is a $15 billion investment from Google, designated for building its largest AI infrastructure hub outside the United States. 4, 5, 7, 8, 9, 13 Additionally, a joint venture involving India's Reliance Industries, Canada's Brookfield, and US firm Digital Realty is set to invest $11 billion to develop an AI-focused data centre within the city. 4, 5, 7, 8, 9, 13 Microsoft also announced a $17.5 billion investment in India's AI infrastructure in December, its largest in Asia, as a long-term bet on India's digital future, according to CEO Satya Nadella. 7, 8 The state is also offering significant incentives, such as providing land to large investors at nearly symbolic prices, to attract these crucial investments and foster a robust supply chain around the data city. 5, 7, 8, 9, 13

Official Vision and Strategic Importance

Minister Lokesh emphasised the transformative potential of this initiative, stating, "The AI revolution is here, no second thoughts about it." 4, 7, 8, 9, 13 He highlighted that the focus is on how quickly India can become indispensable in the global digital economy, rather than merely debating AI adoption. 4 The project aligns with the broader objective of positioning India as a global technology leader, with a strong emphasis on developing advanced AI infrastructure and driving overall digital growth. 0, 4 Andhra Pradesh aims to achieve six gigawatts of data centre capacity, with half already secured through agreements. 4, 5, 13

India's Broader AI Push

This mega-project in Visakhapatnam is part of India's larger strategy to bridge the artificial intelligence gap with global leaders like the United States and China. 4, 7, 8, 9, 13 India is currently ranked third globally in AI strength, based on indicators such as patents and private investment. 4 The Union Budget for 2026-27 has also set the stage for India to become a global hub for cloud computing and AI infrastructure, proposing a long-term tax holiday until 2047 for eligible foreign cloud companies operating data centres in the country. 10 Furthermore, Andhra Pradesh is also preparing to host South Asia's most powerful quantum computer by July 2026, in partnership with IBM and TCS, further solidifying its role in advanced technology. 12

KEY TAKEAWAYS

• India is planning a massive AI 'data city' in Visakhapatnam, Andhra Pradesh, to boost its artificial intelligence capabilities.
• The project has secured an estimated $175 billion (₹14.5 lakh crore) in investment agreements across more than 700 projects.
• Google has committed $15 billion, and a joint venture of Reliance Industries, Brookfield, and Digital Realty will invest $11 billion in the city. Microsoft has also made a $17.5 billion investment pledge for India's broader AI infrastructure.
• The initiative aims to position India as a global technology leader by developing advanced AI infrastructure, hyperscale data centres, and enhanced digital connectivity.
• Andhra Pradesh IT Minister Nara Lokesh is spearheading the project, which includes offering incentives like low-cost land to attract investors.

PEOPLE ALSO ASK

• Q1: Where will India's new AI 'data city' be located?
  A1: India's new AI 'data city' is planned for Visakhapatnam, also known as Vizag, in the state of Andhra Pradesh. The project will establish a comprehensive data ecosystem across a 100-kilometre radius around the city. 4, 5, 7, 9, 13
• Q2: What is the estimated total investment in India's AI 'data city'?
  A2: The 'data city' initiative has secured an estimated $175 billion (₹14.5 lakh crore) in investment agreements from various global tech giants and partners. 4, 7, 8, 9, 13
• Q3: Which major companies are investing in the Visakhapatnam AI 'data city'?
  A3: Key investors include Google, with a $15 billion commitment, and a joint venture of Reliance Industries, Brookfield, and Digital Realty, investing $11 billion. Microsoft has also pledged $17.5 billion for India's broader AI infrastructure. 4, 5, 7, 8, 9, 13
• Q4: What are the main objectives of this AI 'data city' project?
  A4: The primary goals are to significantly boost India's artificial intelligence capabilities, establish the country as a global technology leader, develop advanced AI infrastructure, and attract international capital and computing power. 0, 4