HCLTech invests $1.48 billion in AI data center with Sarvam AI, plans 5,000-seat tech hub

HCLTech Commits $1.48 Billion to First AI Data Center

HCLTech has announced plans to invest 142.57 billion rupees ($1.48 billion) to establish its first AI data center at the upcoming Odisha Sovereign AI Park in partnership with Sarvam AI and the Odisha government1

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. The capital outlay includes financial assistance from the Odisha government, representing a major shift for India's third-largest IT services firm as it moves beyond traditional outsourcing operations into AI infrastructure2

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This investment follows HCLTech's acquisition of a 10.5% stake in Sarvam AI for $150 million last month, signaling a deepening partnership between the two companies4

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. A Memorandum of Understanding was signed in the presence of Odisha Chief Minister Mohan Charan Majhi, Electronics and IT Minister Mukesh Mahaling, HCLTech Chairperson Roshni Nadar Malhotra, CEO C Vijayakumar, and Sarvam Co-founder Pratyush Kumar3

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Full-Stack AI Capabilities Drive Strategic Expansion

The Bhubaneswar-based facility will leverage HCLTech's full-stack AI capabilities and Sarvam's foundation models to deliver sector-specific AI applications to both government-owned and private companies. HCLTech CEO C Vijayakumar explained the company's vision during a post-earnings press conference: "it's the data centre, it's the GPUs, it's the models, it's the applications that we will deliver on top of it. The overall value creation is significantly of a very different magnitude when you really look at this as a full stack, and that's really what we want to play".

The project aims to strengthen India's sovereign AI ecosystem by addressing data sovereignty requirements while supporting multilingual AI services to expand digital access across the country2

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. Roshni Nadar Malhotra emphasized this alignment with national priorities: "In line with the Digital India and Atmanirbhar Bharat vision of Hon'ble Prime Minister Sh. Narendra Modi, we strive to be an enabler of India's sovereign AI ecosystem with differentiated offerings across the value chain through focused investments and partnerships"3

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5,000-Seat Tech Hub Expands Odisha Footprint

Alongside the AI data center, HCLTech will open a 5,000-seat tech hub in Bhubaneswar, with operations expected to begin by 20281

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. This dual investment underscores the company's commitment to building comprehensive India's AI infrastructure in Odisha, a state offering what executives describe as a progressive policy environment backed by excellent infrastructure3

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Pratyush Kumar, Co-Founder of Sarvam, noted that "The Odisha Sovereign AI Park will connect high-performance compute with Indian models and real-world applications. Together with HCLTech, we are excited to bring Sarvam's full-stack AI capabilities to enterprises and public systems at scale"3

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India Emerges as Key AI Data Center Market

India's IT services firms are increasingly entering the data center business to capitalize on demand from AI and cloud computing while diversifying their revenue streams4

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. The country's data center ecosystem is experiencing rapid growth, driven by the expanding digital economy, data localization requirements, and critical infrastructure needs to support GPU deployments for AI training and inference workloads2

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HCLTech's move follows a similar announcement by larger peer Tata Consultancy Services in November, which revealed plans to invest $2 billion to develop AI data centers in partnership with private equity firm TPG1

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. The AI boom has triggered a rush among companies to pour money into data centers, with India positioned as a key market due to its large internet user base and lower power and operating costs4

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This partnership between HCLTech, Sarvam AI, and the Odisha government represents a strategic bet on India's growing role in the global AI landscape, combining private sector expertise with government support to build sovereign AI capabilities that can serve both domestic and international markets.