Indian IT services company HCLTech will invest 142.57 billion rupees, about $1.48 billion, to build its first AI data centre in Odisha in partnership with Indian AI startup Sarvam AI. The project will receive financial support from the Odisha government and will combine HCLTech’s AI infrastructure capabilities with Sarvam’s foundation models to develop sector-specific AI applications for government and private companies.
The investment comes as demand for AI computing infrastructure grows in India, where a large internet user base and relatively lower power and operating costs are attracting data centre investment. HCLTech announced the project shortly after revealing plans to enter the data centre market with a 35 billion rupee investment. Rival Tata Consultancy Services also announced plans in November to invest $2 billion in AI data centres with private equity firm TPG.
Odisha is emerging as India’s next AI hub.
HCLTech and Sarvam AI will set up their first AI Data Center in Bhubaneswar with an investment of $1.48 billion (₹14,257 crore).
Just last month, HCLTech acquired a 10.46% stake in Sarvam AI.
And here is an Odisha connection – Sarvam…
— Manas Muduli (@manas_muduli) July 24, 2026
Why Indian IT companies are investing billions in AI data centres
India’s biggest IT companies are moving beyond traditional software services and positioning themselves to benefit from the growing demand for AI computing. HCLTech’s partnership with Sarvam AI is also notable because it combines local AI models with large-scale infrastructure, giving Indian companies and government agencies access to AI systems built for domestic use.
The move follows a similar strategy by Tata Consultancy Services (TCS), suggesting India’s IT hubs see data centres and AI infrastructure as a new source of long-term growth rather than relying only on outsourcing and consulting services.
Can HCLTech’s AI strategy compete with global cloud giants?
HCLTech’s move into AI data centres puts it in a market dominated by companies such as Microsoft, Google and Amazon, which have spent billions building the computing infrastructure needed to run advanced AI models. HCLTech is taking a different route by combining data centre infrastructure with Sarvam AI’s Indian foundation models and its existing IT services business. That could help the company target enterprises and government agencies that want AI systems tailored to local needs rather than relying entirely on foreign cloud platforms.
The challenge will be scale, as these global cloud providers have much larger infrastructure networks and far greater computing resources, while AI workloads require huge amounts of electricity, advanced chips and expensive data centres. Meanwhile, India is speeding up efforts to build its own artificial intelligence ecosystem, with the government supporting 20 homegrown AI model proposals, allocating more than 93 lakh GPU hours and expanding AI training and safety programs under the IndiaAI Mission.
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