Indian IT giant Tata Consultancy Services (TCS) has secured $1 billion in funding from private equity firm TPG as part of a $2 billion, multi-year initiative to build a network of gigawatt-scale data centers across India. The project, named “HyperVault,” is a direct response to the surging demand for AI compute infrastructure, which is outpacing the industry’s ability to deliver the power-intensive facilities needed to support advanced artificial intelligence workloads. India generates nearly 20% of the world’s data but currently accounts for only about 3% of global data center capacity—highlighting a significant supply-demand imbalance. As AI adoption accelerates across industries, both domestic and international tech firms are investing heavily to expand local infrastructure and capture growth opportunities. HyperVault will focus on developing liquid-cooled, high-density data centers equipped with the power and network capabilities required to support next-generation AI models. These facilities will serve major cloud regions and enable hyperscalers, AI startups, and enterprises to deploy compute-heavy applications such as large language models and real-time inference systems. Liquid cooling is becoming increasingly essential for AI data centers, as high-performance GPUs used in training and inference generate far more heat than traditional CPUs. However, this technology raises environmental concerns, particularly in India, where water scarcity is a pressing issue. According to S&P Global, citing Uptime Institute data, a single 1-megawatt data center can consume up to 25.5 million liters of water annually for cooling—adding strain to already stressed urban water systems in cities like Mumbai, Bengaluru, and Chennai, where much of India’s data center infrastructure is concentrated. The rapid expansion of AI data centers also intensifies pressure on India’s power grid and land availability. High-density AI clusters require stable, high-capacity electricity and large tracts of industrial land—resources that are increasingly difficult to secure in densely populated urban areas. Despite these challenges, global tech companies are viewing India as a critical frontier for AI infrastructure development. Over the past two years, more than $32 billion in investments have been announced for data center expansion in the country. In January, Microsoft committed $3 billion over two years to strengthen India’s cloud and AI infrastructure. In October, Google announced a $15 billion investment over five years to build a gigawatt-scale AI data center hub in Andhra Pradesh. Amazon has also pledged $12.7 billion to expand AWS cloud infrastructure in India through 2030. TCS plans to work with hyperscalers and AI companies to design, deploy, and operate the HyperVault platform, with an initial target of 1.2 gigawatts of capacity. S&P Global estimates that over 95% of India’s new data center capacity in the next five years will come from leased facilities, while the rest will be developed by hyperscalers building dedicated AI infrastructure. Local players such as Reliance Industries and CtrlS are also expanding their footprint to meet rising demand. TCS and TPG project that India’s total data center capacity could surpass 10 gigawatts by 2030, up from approximately 1.5 gigawatts today—marking a transformative shift in the nation’s digital infrastructure landscape.