Microsoft commits billions to expand AI and cloud infrastructure in Canada and India
Today, Microsoft announced two significant global infrastructure expansions in Canada and India that strengthen its cloud and AI capabilities.
In Canada, the company will invest 19 billion CAD between 2023 and 2027 to expand nationwide cloud and AI infrastructure. More than 7.5 billion CAD will be deployed over the next two years to bring new datacentre capacity online beginning in the second half of 2026. The plan includes expanding the Azure Canada Central and Canada East regions.
Microsoft will also introduce a Sovereign AI Landing Zone designed to help organizations run fully compliant AI workloads inside Canada. This will be an open-source AI Landing Zone whose code will be hosted publicly on GitHub. Microsoft will also expand its Azure Local offering, bringing Azure features to private cloud and on-premises infrastructure.
In a parallel announcement, Microsoft confirmed a 17.5 billion USD investment in India from 2026 to 2029 to build a hyperscale cloud and AI backbone across the country. A central component is the India South Central cloud region in Hyderabad, which is planned to go live in mid-2026 with three availability zones capable of supporting large-scale AI compute. With this expansion, Microsoft claims that it will have the largest hyperscale presence in India.
Microsoft also plans to expand sovereign cloud options in India by providing isolated infrastructure, in-country data processing, and enhanced compliance controls that meet government and regulated sector requirements. Recently, Microsoft announced that Microsoft 365 Copilot will offer in-country data processing in India by the end of 2025.
With Sovereign Public Cloud, customers can deploy workloads in Azure with built-in compliance guardrails using Sovereign Landing Zones. With Sovereign Public Cloud, powered by Azure Local, customers can even perform disconnected operations through Microsoft’s partners’ data centers.
Together, these two significant investments signal a coordinated expansion of Microsoft’s global AI infrastructure footprint. As countries around the world tighten data regulations, such localized cloud and AI infrastructure will be crucial for adopting enterprise-grade AI in regulated sectors.