India seeks to attract over $200 billion in investments in AI infrastructure by 2028

India has launched an aggressive campaign to attract more than $200 billion in investment in AI infrastructure over the next two years, as it seeks to position itself as a global hub for AI computing and applications at a time when capacity, capital and organization are becoming strategic assets.

The plans were presented on Tuesday by India’s IT Minister Ashwini Vaishnaw (pictured above) at the five-day Indian government-backed AI Impact Summit in New Delhi, attended by senior executives from OpenAI, Google, Anthropic and other global technology companies. To attract investment, the government is offering a mix of tax incentives, state-backed venture capital and policy support with the aim of attracting more of the global AI value chain to the South Asian country.

India’s bid comes as US tech giants, including Amazon, Google and Microsoft, have committed about $70 billion to expanding the country’s AI and cloud infrastructure, giving New Delhi the basis for arguing that it can combine scale, cost advantages and political incentives to attract the next wave of global investment in AI computing.

While the bulk of the projected $200 billion is expected to flow into AI infrastructure — including data centers, chips and supporting systems, including about $70 billion already pledged by big tech companies — Vaishnau said the Indian government also expects an additional $17 billion in investment in deep tech and AI applications, highlighting the push to move beyond infrastructure and capture more of the value chain.

This effort is supported by recent political decisions Aims to make India a more attractive base for AI computing, including long-term tax exemption for export-oriented cloud services and INR 100 billion (about $1.1 billion) A government-backed venture program targeting high-risk areas such as artificial intelligence and advanced manufacturing. Earlier this month, New Delhi also extended the period in which deep tech companies qualify as startups to 20 years and raised the revenue threshold for benefits for startups to 3 billion Indian rupees (about $33.08 million).

“We have seen venture capital firms committing to funding digital technology startups,” Vaishnau said at a press conference on the sidelines of the AI ​​Impact Summit in New Delhi. “We’ve seen VCs and other players commit to funding big solutions and big applications. We’ve seen VCs commit money to further research into cutting-edge models.”

The minister said India plans to expand its joint computing capacity under the IndiaAI mission beyond 38,000 GPUs, with an additional 20,000 GPUs to be added in the coming weeks, signaling what he described as the next phase of the country’s AI strategy.

Looking to the future, Vaishnaw said the Indian government is preparing for a second phase of its AI mission, with a stronger focus on R&D, innovation and broader deployment of AI tools, along with further expansion of shared computing capacity, as India seeks to expand access to AI infrastructure beyond a small group of companies.

This campaign also faces structural challenges, including access to reliable power and water for energy-intensive data centres, underscoring implementation risks as India seeks to compress years of building AI infrastructure into a much shorter time frame.

Vaishnau acknowledged these challenges, saying the government recognizes the pressure that AI infrastructure will put on energy and water resources, and pointed to India’s energy mix – where more than half of installed generation capacity comes from clean sources – as an advantage with rising demand from data centres.

India’s ability to realize this vision is important beyond its borders, as companies search for new locations for AI computing amid rising costs, capacity constraints, and increasingly intense global competition.