₹14-lakh-crore-plus investments, hyperscale datacenters and clean-energy infrastructure to anchor nation-scale AI ecosystem
India is planning one of the world’s largest artificial-intelligence-focused infrastructure projects — a sprawling “AI Data City” in Visakhapatnam, Andhra Pradesh — as it accelerates efforts to become a global AI powerhouse and rival established hubs in the US and China.
The project, spearheaded by Andhra Pradesh’s IT leadership under Nara Lokesh, aims to transform the coastal port city into a dense cluster of hyperscale datacenters, semiconductor-linked industries and digital infrastructure powered largely by renewable energy. Officials say investment commitments already total about $175 billion across 760 projects, underscoring the unprecedented scale of the initiative.
At the core of the vision is the creation of a multi-gigawatt datacenter ecosystem. Andhra Pradesh is targeting around 6 GW of capacity — with roughly half already signed — positioning Visakhapatnam among the world’s largest AI compute hubs once complete.
Hyperscale Anchors: Google and Global Tech
A flagship anchor investment is a $15 billion AI datacenter hub by Google, expected to be its largest such facility outside the United States.
The campus will integrate subsea cable connectivity, clean-energy supply and high-capacity computing infrastructure — critical ingredients for large-model AI training and sovereign cloud platforms.
Other major projects already announced in the region include a nearly ₹1-lakh-crore AI-native datacenter campus backed by Reliance Industries, reinforcing Visakhapatnam’s emergence as India’s primary AI infrastructure corridor.
Nation-Scale AI Infrastructure Strategy
The AI Data City is part of a broader national push to close the AI capability gap with leading economies. India’s strategy emphasizes building domestic compute capacity, cloud infrastructure and AI-ready industrial ecosystems rather than relying solely on imported technology stacks.
State officials highlight that the project goes beyond datacenters to include semiconductor supply chains, digital services parks, AI research clusters and manufacturing facilities — effectively creating an integrated AI industrial zone. Incentives such as subsidized land and fast-tracked approvals are being offered to attract hyperscale investors and component manufacturers.
Why Visakhapatnam?
Visakhapatnam offers a unique combination of advantages for AI-scale infrastructure: coastal landing points for international subsea cables, access to renewable power corridors, available industrial land and proximity to Southeast Asian digital markets. The city is already slated for large-scale datacenter power and water infrastructure upgrades, reflecting expectations of massive capacity expansion.
Analysts note that India’s datacenter demand is surging rapidly, driven by cloud adoption, AI model training and data localization policies. National power demand from datacenters alone could exceed 2 GW by 2026, highlighting the urgency of new infrastructure hubs.
Strategic Implications
If realized at planned scale, the Visakhapatnam AI Data City would place India among the top global AI compute geographies, alongside Northern Virginia, Dublin and Singapore. It would also strengthen domestic semiconductor-adjacent manufacturing and cloud sovereignty — key strategic priorities as nations race to secure AI infrastructure.
For Andhra Pradesh, the project represents a cornerstone of its “Swarnandhra 2047” economic vision. For India, it signals a shift from digital-services leadership toward foundational AI infrastructure ownership.
As global AI demand accelerates, the success of Visakhapatnam’s AI Data City could redefine India’s position in the emerging compute-driven digital economy — and reshape the geography of AI infrastructure worldwide.
