Amazon and Microsoft Pour $52B Into India in Battle for AI Supremacy — Here's How They're Betting Differently

Amazon has announced plans to invest more than $35 billion in its Indian operations by 2030. The announcement came last week, as the company emphasised its long-term commitment to the fast-growing market. In the same week, Microsoft pledged $17.5 billion, marking its biggest investment in Asia to date. This capital will be channelled into building cloud infrastructure and training India's burgeoning workforce.

Together, these two US technology giants are injecting over $52 billion into India, aiming to shape how the country's 1.4 billion people will use artificial intelligence in the coming decades. Amazon's focus is on empowering 15 million small businesses with AI-driven tools, while Microsoft's strategy targets reaching 310 million informal workers through government employment platforms.

What Each Company Is Promising

Amazon's $35 billion investment adds to a total of around $40 billion already spent in India since 2010. In 2023 alone, the company committed $26 billion. The upcoming funds are intended to bring AI tools to millions of small enterprises and to quadruple exports to $80 billion by 2030. Amazon also projects the creation of approximately 3.8 million jobs as a result of these efforts.

Microsoft's commitment of $17.5 billion over four years follows an earlier announcement of $3 billion in January—its largest Asian investment to date. The company's focus is on training India's 310 million informal workforce via platforms like e-Shram and other state employment schemes. Since January, Microsoft has already trained 5.6 million individuals, enabling over 125,000 to secure jobs or start new businesses. While Amazon concentrates on building marketplace infrastructure, Microsoft's emphasis is on workforce development at scale.

Why India Matters

India, recognised as the world's most populous nation, is an essential market for Amazon due to its rapidly expanding internet user base, according to Reuters. Amazon's cumulative investments have made it India's largest foreign investor, as noted in a report by Keystone Strategy commissioned by the company.

Microsoft's chairman, Satya Nadella, recently met Prime Minister Narendra Modi to discuss India's AI priorities and how Microsoft's technology could support them. The Indian government's focus on digital inclusion and AI-driven growth has attracted attention from global tech firms.

Other US giants are also investing heavily in India. Reuters reported that Google has committed $15 billion over five years to develop AI data centres. As the country emerges as a strategic hub for AI and cloud infrastructure, India has become a focal point for billions of dollars from major tech companies.

The Competition They Face

Amazon's increased spending is partly driven by the need to compete with local players such as Flipkart, backed by Walmart, and Reliance Industries, led by billionaire Mukesh Ambani. Both firms are deeply entrenched in India's retail and technology sectors.

Microsoft is also addressing India's data sovereignty requirements. The company is deploying cloud systems that process all data within India, ensuring no customer information leaves the country. This move will be rolled out by the end of the year, positioning India among the top four markets globally to benefit from these capabilities. Digital sovereignty has become a key priority for Indian enterprises, and Microsoft's investment aligns with this shift.

India's market size—more than a billion potential users—gives it significant leverage. US tech firms are increasingly tailoring their systems to meet local requirements, even when such demands are resisted elsewhere.

How the AI Ecosystem Is Developing

Amazon's AI tools are already being utilised by sellers on its platform. Features like Seller Assistant and Lens AI enable visual search and automatic product descriptions in multiple languages. For example, a textile merchant can photograph fabric, have AI generate descriptions, and list items on Amazon.in within minutes—tasks that once required translation services.

Meanwhile, Microsoft is integrating Azure AI into government employment platforms, offering multilingual job matching and automated résumé creation for informal workers. The goal is to facilitate a smoother transition into formal employment, according to the company.

Both firms frame their efforts as democratising technology. Amazon states it aims to bring 'AI benefits to 15 million small businesses,' while Microsoft speaks of enabling 'AI diffusion at population scale'.

The Real Prize: Control of India's Digital Infrastructure

By 2030, Amazon projects to generate $80 billion in exports from India, quadrupling current levels. Microsoft, on its part, aims to train 20 million Indians in AI skills within the same timeframe.

However, the true battleground is infrastructure. When an Indian retailer in Mumbai processes payments through Amazon's system or ships via its logistics network, switching platforms becomes nearly impossible. The same applies to Microsoft's platforms serving hundreds of millions of workers.

Both companies are constructing the foundational digital systems—payments, logistics, data centres, and cloud platforms—that will underpin India's economy for decades. Once embedded, these systems are virtually irreplaceable, giving the tech giants significant long-term influence over India's digital landscape.