Global Data Center Arms Race for AI Compute
The surge in investment in AI data centers signals a strategic pivot towards hyper-scale infrastructure as demand for AI workloads skyrockets. This trend highlights the urgency for countries like India and Australia to position themselves as key players in the global AI landscape, fostering local economies while attracting major tech firms. However, the potential for overbuilding raises concerns about sustainability and the long-term viability of these investments.
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Related Articles (7)
Microsoft commits US$17.5 billion to expand AI and cloud infrastructure in India
Microsoft announced its largest-ever investment in Asia, pledging US$17.5 billion over 2026–2029 to expand AI and cloud infrastructure, skilling and sovereign cloud capabilities across India. The plan includes scaling hyperscale datacenters, integrating Azure OpenAI services into public platforms like e‑Shram and the National Career Service to reach over 310 million informal workers, and doubling its AI skilling target in India to 20 million people by 2030.
AI cloud startup Fluidstack reportedly seeks $700M at $7B valuation as data center demand surges
Industry publication The MinerMag reports that AI-focused cloud-computing startup Fluidstack is in talks to raise around $700 million at a valuation of roughly $7 billion, reflecting investor appetite for infrastructure that can serve AI workloads. The article situates Fluidstack’s ambitions within a broader boom in AI-optimized data centers, including partnerships and capacity expansions with mining and energy firms like TeraWulf and Cipher Mining, as capital flows into power- and GPU-intensive facilities.
Australia’s NEXTDC signs deal with OpenAI to build hyperscale AI campus and GPU supercluster in Sydney
Australian data center operator NEXTDC has signed a deal with OpenAI to co-develop and operate a hyperscale AI campus and GPU supercluster at its planned S7 site in Eastern Creek, Sydney. The project will make OpenAI an anchor tenant in what is expected to be the largest data center in the Southern Hemisphere, underscoring the escalating global race to secure AI compute capacity and positioning Australia as a significant regional hub for advanced AI workloads. ([reuters.com](https://www.reuters.com/world/asia-pacific/australias-nextdc-signs-deal-with-openai-build-hyperscale-ai-campus-gpu-2025-12-04/))
Amazon outlines $12.7 billion AI and cloud infrastructure push in India to reach 15 million SMBs and 4 million students
Amazon reaffirmed plans to invest $12.7 billion in local cloud and AI infrastructure in India by 2030, aiming to bring agentic and generative AI tools to 15 million small businesses and AI literacy programs to 4 million government‑school students. The initiative expands AWS data‑center capacity in Telangana and Maharashtra and rolls out AI‑powered seller tools, shopping assistants like Rufus and Lens AI, and large‑scale education programmes aligned with India’s national AI and education strategies.
OpenAI–TCS talks advance on HyperVault AI data centre partnership in India
OpenAI is in advanced discussions with Tata Consultancy Services (TCS) to lease at least 500 MW of capacity in HyperVault, TCS’s new AI-ready data centre subsidiary, according to Indian media reports. The proposed arrangement would make OpenAI the first anchor tenant in HyperVault’s planned gigawatt-scale facilities in India and support joint development of agentic AI solutions for enterprise customers, although no equity investment by OpenAI is planned at this stage.
Indian data center operator Sify Infinit Spaces bets on AI boom but wary of bubble
Sify Infinit Spaces, which is set to become India’s first listed pure-play data center operator, says generative AI workloads are a major driver of demand but warns of potential overbuilding if the hype outpaces sustainable usage. The company, backed by Kotak Private Equity and spun out of early Indian ISP Sify Technologies, operates 14 data centers with 11 more under development and plans a roughly 37 billion rupee IPO, while still relying heavily on hyperscale clients such as Alphabet, Amazon and Microsoft for capacity growth.
Adani eyes up to $5B investment in Google’s India AI data center project
Adani Group said it could invest as much as $5 billion via Adani Connex in Google’s planned AI data center campus in Visakhapatnam, Andhra Pradesh. The project—part of Google’s previously announced $15 billion India AI buildout—would start at 1GW of power, reflecting the surge in compute needs for AI workloads and India’s push to scale domestic data infrastructure.