Reimagining India’s Digital Infrastructure: Google’s $15 Billion Bet and India’s Digital Leap

In an era defined by algorithms and data flows, infrastructure and technology have become the new instruments of geopolitical rivalry. Google’s $15 billion investment to establish its largest AI hub outside of the United States has promised to not only revolutionize India’s AI space but also has many geopolitical layers attached to it.

A defining moment in India's technological trajectory and a significant push to India’s AI mission, this investment ushers in a new era of digital infrastructure in the Indian economy. The Google AI Hub in Visakhapatnam will include a purpose-built data center campus, adding gigawatt-scale compute capacity to help meet demand for digital services across India and around the world. The infrastructure will be built in accordance with the standards of Google’s global services, enabling the computing power for the most demanding AI workloads. The American tech giant has partnered with AdaniConneX and Bharti Airtel for the construction of the data center. 

One of the largest issues facing AI infrastructure is the enormous energy requirements, for which AdaniConneX will lead in the construction of the data center complex and develop green energy solutions to power the facility sustainably. By building a cutting-edge Cable Landing Station to house Google's new international subsea gateway, Bharti Airtel brings the state-of-the-art standard of connectivity needed. The choice of Visakhapatnam on India's eastern coast, facing Southeast Asia where American and Chinese influence compete intensely, carries strategic significance and establishes it as the node of connectivity in global data flows. When we look at the bigger picture, this is not merely a data center but rather a comprehensive reimagination of digital infrastructure in India, which puts India at the forefront to be an AI superpower. 

Examining the Scale of the infrastructure

The Visakhapatnam AI hub would boast a capacity of around 1000 megawatts (1 GW) with the potential to scale to multiple gigawatts and would be spread across a campus of around 480 acres spanning three districts in Andhra Pradesh: 200 acres at Tarluvada in Visakhapatnam district, 120 acres at Adavivaram and Mudasarlova villages, and 160 acres at Rambilli in Anakapalli district. 

Union Minister Ashwini Vaishnaw welcomed Google’s TPUs (Tensor Processing Units) to compete with Nvidia’s GPUs (Graphics Processing Units). Although the facility will be powered by both GPUs and TPUs, the computational core of the facility will run via TPUs. TPUs can rival or surpass the performance of metrics given by GPUs, and they also reduce the dependency on Nvidia’s expensive global supply chain. 

The element with layers of strategic consequences is the construction of the international subsea cables. Bharti Airtel will construct the dedicated cable landing station, making Visakhapatnam, India, its sixth cable landing city. This new pathway will complement existing landings in Mumbai and Chennai, providing necessary route diversity and increasing the resilience of India's digital backbone. In modern times, the majority of the data is transmitted via fiber optic cables rather than satellites; consequently, it makes Vizag a vital cog in global data flows.

Visakhapatnam’s location on India’s eastern coastline offers great connectivity to Southeast Asia, Australia, and other regions, making it a viable alternative to the already overburdened Singapore-Subsea cables. These subsea cables also carry a lot of relevance in national security functions such as intelligence, defense systems, and communication, thus strengthening India’s position in the Bay of Bengal region. 

Google has maintained its commitment to operate the most energy-efficient data centers in the world, and it will be a challenge to fulfill this commitment with the AI hub expected to have a 2091 MW power requirement, which is just 0.5% of India's total installed electricity generation capacity. The foundation of Google's power strategy is its alliance with Adani Green Energy Limited (AGEL), the largest renewable energy firm in India and the second-largest in the world by capacity. By October 2025, AGEL's operational renewable energy capacity was around 16,729 MW which includes solar, wind, and wind-solar hybrid forms.

Catalyst for Growth: Economic and Entrepreneurial gains

According to Mr. Pemmasani Chandrasekhar, this project is expected to generate around Rs. 10,000 crore (US$1.13 billion) in revenue for the state. It is also expected to boost employment by creating 5000-6000 direct jobs and up to 30,000 indirect jobs, helping to address the problem of brain drain associated with many highly skilled technicians in India. There is also excellent news for the local real estate market because there is a greater demand for luxury, retail, and commercial real estate development in the vicinity of the data center.

However, the benefits go beyond just jobs; the hub is designed to deliver high-performance, low-latency services that businesses, developers, and researchers need to build and scale AI-powered solutions, providing a platform for innovations in all sectors. It will help democratize the access to AI with pre-trained models, which local businesses can leverage for customer analytics, predictive maintenance, and supply chain optimization. It directly aligns with the goal of Viksit Bharat 2047, as Indian startups would no longer need to rely on overseas cloud models, eventually leading to a boom in Indian AI startups using Google infrastructure. As the hub would serve global functions, it paves the way for India to be an export hub of AI services.

Forecasting Growth: India’s AI Market Climate

India’s artificial intelligence market is expanding rapidly. According to the Boston Consulting Group via IBEF, the market is projected to surpass US$17 billion by 2027, more than tripling from its 2024 level. India possesses over 16% of the global AI talent pool, second only to the United States. With development in digital infrastructure, India’s AI market is soaring with promise. A global race between US tech giants—Microsoft, AWS, Meta, and Google—to build infrastructure for hosting AI services has opened up a multi-billion-dollar opportunity, one that could turn India into a regional AI powerhouse.

The ‘hyperscalers’ have committed to invest over $300 billion in 2025 alone, out of which around $40 billion is earmarked for the Asian-Pacific region. India has a significant shot at capturing this investment and becoming an AI leader. With the upcoming global AI summit being hosted by India in 2026, it puts India in the driving seat to be the voice of the global south. 

The Indian government has proposed various incentives to attract foreign direct investment in accordance with India’ AI mission. India has proposed a 20-year conditional tax holiday for data centers, amidst a slew of other benefits for data center operators, that could prove to be a potential game changer for the industry. Over the last five years, as India’s data center industry has been attracting global attention and investments, this has highlighted the need for a more robust national data policy. India's Ministry of Electronics and Information Technology (MEITy) convened a gathering of stakeholders in early August to explore how a national strategy could actually support the country's digital transition into the next phase. The draft policy proposed a series of tax exemptions and also granted permanent establishment status to foreign companies leasing over 100 MW. 

Google's Raiden Infotech India received an incredibly hefty incentive package from Andhra Pradesh Chief Minister Chandrababu Naidu's government for the Visakhapatnam AI hub, worth ₹22,002 crore over the course of the project. The package included multiple layers of tax exemptions designed to reduce Google’s upfront capital expenditure, discounts on the land allocated for the data center, and electricity subsidies. Chief Minister Naidu is placing a wager that Google's investment will trigger an ecosystem effect that multiplies the state's profits far beyond the cost of the subsidies by drawing in complementary investments in AI startups, renewable energy, telecoms, and skilled labor. 

From Partnership to Power Play: Diplomatic Implications on the US-India Technological Ties

US Secretary of Commerce Gina Raimondo and Prime Minister Modi both attended the joint announcement, which was a diplomatic reaffirmation of their shared values: respect for democratic governance, open markets, and technical interoperability. It solidifies India's position as a key node in the Transforming Relations Using Strategic Technologies (TRUST) framework between the US and India. 

As part of a larger US-China power struggle, the establishment of the subsea cable landing and  gigawatt AI data center on the Bay of Bengal’s northern coast diversifies and provides alternative data routes to China-dominated cables transiting the South China Sea. This reduces geopolitical vulnerability and exemplifies the US and India collaborating to counterbalance Chinese efforts to control regional digital corridors.

In addition to hardware deployment, the US and India are working together on this hub through cooperative R&D projects, capacity-building programs at Indian Institutes of Technology, and the creation of open-source AI models, enabling Indian researchers and startups to leverage AI to create solutions. 

Even if trade and tariff uncertainty have increased, collaboration across critical industries is unlikely to be halted by these frictions. For the US, India offers trusted capacity in critical technology fields outside East Asia’s geopolitical chokepoints, capacity that is increasingly central to its Indo-Pacific strategy and long-term competition with China. For India, the partnership accelerates its climb up the technology value chain, provides access to frontier research and development (R&D) ecosystems, and embeds its emerging industries in global supply chains. 

How does India build on this?

Although the promise of this investment is undeniable, there are questions to be asked for digital sovereignty. Even though India gains digital infrastructure, it doesn’t necessarily gain the technological capabilities that truly matter in the AI age. The AI capabilities, software stack, and fundamental technologies remain Google's intellectual property. Indian businesses and services may become overly dependent on Google’s infrastructure and tools, which would effectively give Google control over algorithms that increasingly govern economic and social life.

India needs to ride the perils of digital sovereignty with caution and precision. It needs a strategy that focuses on not just building infrastructure but also increasing capacity building. Future contracts should focus more on joint R&D programs and open-source contributions that build India’s domestic expertise. More incentives should be given to domestic companies to build digital infrastructure. India needs to strengthen and rigorously enforce data governance frameworks.

This might include mandatory local processing requirements and algorithmic transparency obligations. India needs to create its own alternatives to foreign investment through investment in indigenous AI research centers, aligning with the vision of Viksit Bharat. 

Finally, India has the potential to be the face of the global south in AI governance; it needs to actively participate in AI governance frameworks and protect the global south from digital colonialism. 

Google's $15 billion Visakhapatnam AI hub represents an opportunity for India to truly become the next AI superpower. It has laid the foundation for a plethora of opportunities and is well and truly a game-changer for the AI sector in India. Although the groundwork has been established, India must design the intelligence that flows through it rather than just host it in order to achieve full digital autonomy.