OpenAI is in preliminary discussions with Indian data centre companies, including Sify Technologies, Yotta Data Services, E2E Networks, and CtrlS Datacenters, as it explores bringing its $500 billion global joint venture supercomputing project, Stargate, to India, according to a report by Economic Times.
Parallel talks have reportedly been ongoing with Reliance Industries for over six months. Reliance plans to build the world’s largest data centre at Jamnagar in Gujarat. Discussions so far have focused on installed capacities, location spread, and power availability, the ET report said.
AIM reached out to Yotta and E2E Networks, who declined to comment, and OpenAI had not responded by the time of publishing.
The move follows a request from the Indian government asking OpenAI to invest a portion of the $500 billion Stargate project in India and store Indian user data locally. “India is becoming a key market for OpenAI and also has potential to become a large revenue generator so the company should invest a large percentage of the $500 billion Stargate project in India,” the ET report quoted an official as saying.
“It should start storing and processing the data of residents within the country as well since others like Microsoft and Google already have large data centres in the country and Meta and AWS are expanding. It will reduce their latency and improve their service as well.”
OpenAI CEO Sam Altman highlighted India’s strategic importance, saying last month that the country is the company’s second-largest market after the US and may become the largest, noting it is incredibly fast-growing.
The company is expanding its India presence, setting up its first office in New Delhi, hiring for sales leadership roles, and offering aggressive pricing for local subscribers.
Altman himself is flying in next month to India. “AI adoption in India has been amazing to watch…We are excited to invest much more in India,” he said.
While OpenAI has enabled local data residency in India, Japan, Singapore, and South Korea, models still reside on foreign servers, meaning enterprise inference processes require cross-border data exchange, the report said.
Announced in January, Stargate aims to invest $500 billion over four years to build new AI infrastructure in the US, with SoftBank, OpenAI, Oracle, and MGX as initial equity funders. Technology partners include Arm, Microsoft, NVIDIA, Oracle, and OpenAI.
Currently, India accounts for less than 1% of global AI compute capacity. By comparison, a single 1 GW hyperscale data centre for OpenAI would require nearly 135,000 NVIDIA B100 Blackwell chips and 1.3 GW of continuous power—far exceeding India’s present non-AI cloud capacity of under 1 GW, according to ET.
Nevertheless, there are signs of progress. Google Cloud is reportedly set to invest $6 billion to build a 1 GW data centre in Andhra Pradesh, while Reliance aims for a 1 GW facility at Jamnagar and a $10 billion new energy giga complex.
