Tech giants fierce competition in India: Amazon adds $35 billion to counter Microsoft's AI ambitions

In the current climate of intensifying competition in the global AI and cloud computing markets, India has become a key battleground for major tech giants. Amazon (AMZN) recently announced an ambitious long-term investment plan, aiming to inject over $35 billion (approximately NT$1 trillion) into India by 2030. This move clearly targets Microsoft’s recent announcement of a $1.75 billion “India AI investment plan.” The capital race among these tech giants reflects the enormous commercial potential of India’s digital market.

Expansion of Investment Footprint: Amazon’s Three Strategic Focus Areas

Amazon’s latest investment builds upon its existing foundation. The company has already invested nearly $40 billion (about NT$1.2 trillion) in India, and this additional $35 billion demonstrates strong confidence in the Indian market. The new funds will focus on three core directions: first, driving digital transformation of local businesses through AI technology; second, helping Indian domestic companies reach an export scale of $80 billion; third, creating over 1 million new jobs to promote overall economic ecosystem upgrades.

Amazon has established a comprehensive infrastructure system in India, including logistics centers, data centers, and digital payment platforms. Future plans include applying AI tools to the operations of over 15 million small and medium-sized enterprises, significantly enhancing their efficiency and market competitiveness.

Strategic Value of the Indian Market

As the most populous country globally and South Asia’s fastest-growing major economy, India offers unparalleled digitalization opportunities. It is predicted that by the end of this year, India’s internet user base will surpass 900 million. This large and continuously growing digital market has become a vital high-growth hub for American tech companies such as Google and Amazon.

However, Amazon does not hold an exclusive advantage in this market. It must compete fiercely with strong local rivals like Flipkart, Blinkit, Instamart, and Zepto. These local companies, with near real-time delivery capabilities, have successfully gained significant consumer favor, and Amazon needs to accelerate its efforts to catch up.

Opportunities and Challenges Coexist

While large-scale investments are expected to boost employment and technological advancement, structural issues in India cannot be ignored. Unstable power supply, difficulties in land acquisition, and significant regulatory differences across states could pose substantial obstacles to the deployment of data centers and AI infrastructure. These practical challenges will directly impact Amazon’s ability to realize its grand plans on schedule.

Nevertheless, Amazon’s head of emerging markets emphasized that the company has been operating in India for fifteen years and has witnessed the country’s digital transformation firsthand. Moving forward, Amazon will continue to promote the adoption of AI technology to benefit a broader range of enterprises and citizens. It is foreseeable that the competition between Amazon and Microsoft over the Indian AI market will intensify further.