TCS, OpenAI in advanced talks to build major AI infrastructure in India

Tata Consultancy Services and OpenAI are in advanced discussions to build large-scale AI infrastructure in India, a move that could accelerate the country’s emergence as a major destination for AI development and deployment. The Economic Times reported that the Sam Altman-led company is negotiating a partnership that would give it substantial data centre capacity through TCS’s HyperVault platform.

According to the report, OpenAI is considering leasing at least 500 MW of AI data-centre capacity from TCS to train and run its models within India. Such a deal would give the world’s most widely used AI company a local compute base as demand for generative AI applications continues to surge. TCS, for its part, is said to be keen on using OpenAI’s large-language models to build agentic AI solutions for clients across financial services, retail, consumer goods and manufacturing.

Neither TCS nor OpenAI responded to queries from the newspaper, and the information has not been independently verified by HT media outlets.

A deal of this scale would also mark the beginning of Stargate in India, OpenAI’s global initiative to build next-generation training infrastructure. The company had previously explored partnerships with the Indian government and Reliance Industries for the project, though those negotiations did not progress.

The discussions come as India becomes the second-largest user base of ChatGPT after the United States and an increasingly strategic location for companies seeking access to large, diverse datasets. Multinational technology firms have announced a wave of AI infrastructure investments in recent months, signalling intensifying competition to build compute capacity in the world’s biggest internet market.

Google has outlined plans to invest up to $15 billion over the next five years in its first AI hub in Vizag, including a 1 GW data centre powered by renewable energy. Microsoft is investing $3 billion to expand Azure and AI infrastructure while training one crore Indians in AI skills by 2030. Meta has committed $100 million to Reliance Industries’ upcoming data centre in Jamnagar, and Amazon Web Services has pledged $12.7 billion for cloud and AI investments through 2030.

TCS itself has raised $1 billion from TPG for its HyperVault venture, which aims to build a 1 GW AI data centre—capacity that OpenAI is reportedly exploring. Reliance and Brookfield have separately announced an $11 billion investment to construct another 1 GW AI data centre in Vizag.

Sources cited by the Economic Times said the Tata Group does not intend to dilute its stake in the venture or rely heavily on a single customer, even one of OpenAI’s scale. The company is expected to position HyperVault as a multi-client platform and could court other leading AI developers, including Anthropic.

If the talks progress, the collaboration would strengthen India’s position in the global AI supply chain at a time when demand for compute is outpacing supply and geopolitical competition around AI infrastructure is intensifying. Market analysts say any final agreement would likely influence how global AI firms design their Asia-Pacific strategies in the years ahead.