Hyderabad: Microsoft Corp. is in discussions with the Telangana government to set up up one of its biggest data centres in the state at an investment of $2-2.5 billion, sources said. If the talks fructify, this would be one of the major investments of the Redmond, Washington-based firm outside the United States.

Telangana Minister for IT and Industries KT Rama Rao had a few months ago kickstarted the discussions by initiating dialogues with the senior management of Microsoft.

“The discussions are in the final stage. Certain issues — such as whether it would be a single location or multiple and the size of the investment — are yet to be finalised. Microsoft appears to be willing to go ahead with setting up a data centre here, though officially not confirmed,” sources said.

When contacted, a top official of the Telangana’s IT department said that the company had requested the state government to not disclose the details of the discussions. An email sent to Microsoft remained unanswered.

The Windows maker, led by India-born Satya Nadella, is slated to add data centres in at least 10 more countries this year, and the company is on pace to build between 50 and 100 new data centres each year for the foreseeable future, Noelle Walsh, corporate vice president and non-executive director at Microsoft, had said earlier.

Set up in 1998 in Hyderabad, Microsoft India Development Centre is one of the largest R&D centres of the company outside of the US. The centre represents Microsoft’s strategy of globally shared development to build products and services.

Amazon Web Services (AWS) in November announced setting up of its second data centre region in India in Telangana that will be operational by mid-2022, and will see the tech giant investing about Rs 20,761 crore.


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