AWS To Invest $12.7 Bn In Cloud Infrastructure In India

The India arm of Amazon Web Services (AWS) said on Thursday (May 18) that it will invest INR 1.056 Lakh Cr ($12.7 Bn) by 2030 to upgrade and scale up cloud infrastructure in the country to meet the growing demand.

The company said the investment in the data centre infrastructure will support around 1.32 Lakh full-time equivalent (FTE) jobs in Indian businesses each year, across positions including construction, facility maintenance, engineering, telecommunications, and others.

AWS’s additional investment comes after it finished investing $3.7 Bn in India between 2016 and 2022. The cloud infrastructure arm of the ecommerce giant Amazon would have invested upwards of INR 1.36 Lakh Cr ($16.4 Bn) by 2030.

“AWS’s investment in India has a ripple effect in the local economy in areas, such as workforce development, training and skilling opportunities, community engagement, and sustainability initiatives,” said AWS in a press statement.

“Since 2016, AWS has invested billions of dollars into cloud infrastructure in India to support the tremendous growth we have witnessed in the use of the cloud for digital transformation,” said Puneet Chandok, president of commercial business, AWS India and South Asia (Amazon Web Services India). 

“Our planned investment of INR 1,05,600 crores (US $12.7 billion) by 2030 will help create more beneficial ripple effects, supporting India on its path to becoming a global digital powerhouse,” Chandok added.

The investment also drew comments from the government, as the Union Minister of State for Electronics and Information Technology Rajeev Chandrasekhar said, “India Cloud and the underlying data centre infrastructure are important elements of India’s digital infrastructure and ecosystem. I welcome the Amazon Web Services (AWS) investment of $12.7 Bn to expand their data centres in India. It will certainly catalyse India’s digital economy.”

AWS said that it has two data centre infrastructure regions in India, the AWS Asia Pacific (Mumbai) Region and the AWS Asia Pacific (Hyderabad) Region. To be sure, the cloud infrastructure company’s first investment in India was in the two data centre infrastructure regions. While AWS invested $1 Bn in the Mumbai region, it spent $2.7 Bn to develop the Hyderabad region.

“AWS estimates that its overall contribution to the GDP of India between 2016 and 2022 was more than INR 38,200 crores ($4.6 Bn), and the investment supported approximately 39,500 FTE jobs annually in Indian businesses,” said the company.

The mega investment also comes as AWS has been embroiled in a tussle with the taxman in India over an alleged tax payment of INR 549 Cr on fees earned from its cloud computing services.

The Income Tax department raised a demand of INR 190.85 Cr for 2014-15 and INR 358.27 Cr for 2016-17 under section 147 of the IT Act, which did not involve any penalty. The tax department also sent a notice to AWS at the end of January. However, AWS has called the decision ‘baseless’ and is set to contest it.