"Silicon Valley's New Hub: Inside the $67 Billion Push to Build India's Digital Backbone"

By :Rahul Shivshanka
“Put your money where your mouth is." It is an adage. It simply means this: show by actions and not just words that you support or believe in something. For long, the world’s top CEOs have expressed confidence in India’s growth prospects. But they never quite bet on India by putting down money. But that’s changing. And fast. Unlike anytime in its history, India is now being scoped out by Amazon, Microsoft, and Google, who have in the past few weeks collectively committed over $67 billion. In effect, they’ve made India their biggest digital investment destination outside the United States.

What explains this shift?
Here are some reasons. Perhaps this record and unprecedented investment push is because India is adding more new internet users than any other country. Second, a vast, young, English-speaking workforce continues to anchor global engineering teams. Third, a rapidly rising digital middle class is shopping, streaming, and paying online. Fourth, Indian companies, from tiny retailers to the largest banks, are moving their operations to the cloud at record speed. For Big Tech, this expanding digital consumer and enterprise market is too large to ignore.

But some experts believe that the real story lies beyond consumer growth. The global race for AI has unleashed an unprecedented need for computing power. India, it is being said, offers the right mix of scale, land availability, electricity cost, and policy stability to build hyperscale data centres.
Experts believe that even what once looked like a regulatory hurdle, such as data localisation, now works in India’s favour. If tech giants must store and process Indian data inside the country, they prefer to build that infrastructure themselves. And once built, these data centres become profitable regional hubs serving South Asia, the Middle East, and Africa.

But above and beyond, does it also have something to do with governance?
It’s hard to sometimes see the obvious, especially when the air is poor, the rivers are unclean, and lakhs of air passengers were abandoned to their fate. But somewhere it is becoming increasingly clear that India today offers continuity of governance, faster clearances, incentives for high-tech infrastructure, and the world’s most advanced digital public architecture through UPI, Aadhaar, and ONDC. For companies making multibillion-dollar, multi-decade commitments, India’s democracy and relative policy predictability carry enormous weight.
When crackdowns, censorship, and regulatory uncertainty are becoming the norm around the world, India represents stability and an open democracy. And these are also strategic assets.
This prompts the China question. India is not replacing China as the world’s manufacturing base. But in the digital economy, India is emerging as the main alternative. It is most underestimated, but a lot of credit must go to India’s diversity. An article in a financial daily, the Economic Times, points out that with hundreds of “languages, countless accents, diverse transaction patterns, and a wide spectrum of socio-economic realities, India presents challenges that push AI systems to their limits".
If an AI model can understand India, it can operate anywhere in the world. In effect, India is a natural AI test laboratory.

What does all this add up to?
First, India is moving from the world’s IT back office to the AI front office. Second, India is rising as the anchor of a new non-Chinese digital ecosystem. Third, India has a real shot at becoming an AI-first economy.
The big tech “Gold Rush" is not only about investment. It is a vote of confidence.

First, India is moving from the world’s IT back office to the AI front office. Second, India is rising as the anchor of a new non-Chinese digital ecosystem. Third, India has a real shot at becoming an AI-first economy. The big tech “Gold Rush" is not only about investment. It is a vote of confidence.