Indian state Andhra Pradesh has closed a deal with Google and leading Indian Information and Communications Technology (ICT) service provider Sify. These agreements include $7.9 billion in investment and contributing 1.55 gigawatts (GW) to the state’s data processing capacity, according to NDTV.
Google will be investing $6 billion in a 1 GW data center, which sources claim would be built in the port city of Vishakapatanam — $2 billion of this has been earmarked for developing renewable energy sources to power the center.
Meanwhile, the Andhra Pradesh cabinet officially approved a substantial data center project with Sify in its meeting last week. This involves an investment of around $1.9 billion for a 550 MW data center facility.
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Andhra Pradesh has been working on attracting IT and technology-related businesses, particularly through its recently launched IT & Global Capability Centers (GCC) Policy (4.0) for 2024-2029. This policy offers various incentives including capital subsidies, rental assistance, power incentives, and tailor-made packages for mega-projects. All these incentives aim to close infrastructure gaps, and foster a hybrid work ecosystem.
Nara Lokesh, the state’s minister for IT, electronics, and education, has been a staunch supporter of data center ambitions. He recently said that Andhra Pradesh has already finalized investments for data centers totaling 1.6 GW and aims to build an ambitious 6 GW of data center capacity over the next five years from its current near-zero base. He also added that there were plans to establish three new cable landing stations in Visakhapatnam, further positioning the city as a crucial digital gateway for India and Southeast Asia, potentially rivalling existing hubs like Mumbai.
“We’ve made certain announcements like Sify, which are public,” he said, referring to a 550-MW data center Sify Technologies plans to build in the state. “There are certain announcements which are not yet public. In October, we will make those announcements,” Lokesh said. He is yet to make specific comments on the Google investment.
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The Andhra Pradesh data center will be Google’s largest in investment size and capacity in Asia and is part of a multi-billion-dollar expansion of its data center portfolio across the region in countries including Singapore, Malaysia and Thailand.
Google Cloud opened a region in Mumbai back in 2017, and another in Delhi in 2021. The tech giant also has plans to launch a sovereign AI cloud with Airtel Business this year. In Q4 2025, the India portion of Google’s Blue Raman subsea cable is expected to go live, landing in Mumbai. In 2020, Google said it would spend $10 billion over 5-7 years on helping digitalize the nation; that same year, it invested $4.5 billion in Indian telcom Reliance Jio.
More broadly, Google plans to spend $85 billion on data centers around the world this year. This includes a $25 billion investment to build data centers and AI infrastructure over the next two years in states across PJM Interconnection, the biggest electric grid in the U.S.