India’s TCS Secures $1B From TPG to Fund Half of Its $2B AI Data Center Project

Indian IT heavyweight Tata Consultancy Services (TCS) has secured $1 billion in funding from private equity firm TPG as part of a multi-year, $2 billion initiative to build a network of gigawatt-scale AI data centres across India.

The project — called HyperVault — comes at a time when AI compute demand is rising far faster than companies can deploy the power-intensive infrastructure needed to support it.

India highlights this gap more dramatically than most markets: the country generates nearly 20% of the world’s data, yet holds only around 3% of global data centre capacity. As interest in AI technology surges, major tech and cloud companies have poured billions of dollars into expanding India’s digital infrastructure.

Through HyperVault, TCS and TPG aim to build liquid-cooled, high-density data centres capable of supporting advanced AI workloads in key cloud regions. Such liquid-cooled systems are becoming more common as GPUs powering AI training and inference require significantly more power and generate more heat than traditional CPU-based systems.

However, liquid-cooling also raises sustainability concerns in India, where water scarcity is already a severe issue. In cities like Mumbai, Bengaluru, and Chennai — India’s largest data-centre hubs — water stress could pose challenges. According to S&P Global, a 1 MW data centre load may require up to 25.5 million litres of water annually for cooling, further straining existing infrastructure.

Beyond water consumption, the rapid expansion of AI data centres will intensify pressure on India’s power supply and land availability — two additional constraints frequently cited by industry analysts. High-density AI clusters require steady, large-scale electricity and significant parcels of industrial land, both of which are becoming harder to secure in urban regions.

Even so, global tech companies are treating India as a major frontier for AI infrastructure. More than $32 billion has been committed over the past two years to expanding the country’s data centre footprint, according to S&P Global.

Recent major announcements include:

• Microsoft: $3 billion investment in cloud and AI infrastructure over two years.

• Google: $15 billion commitment over five years to build a gigawatt-scale AI data centre hub in Andhra Pradesh.

• Amazon (AWS): $12.7 billion investment to expand cloud infrastructure in India through 2030.

TCS says it will partner with cloud hyperscalers and AI companies to design, deploy, and operate AI infrastructure as the HyperVault platform grows. The first phase aims to deliver around 1.2 gigawatts of capacity.

S&P Global estimates that over 95% of India’s new data centre capacity over the next five years will come from leased facilities, with the remainder built directly by hyperscalers for dedicated AI infrastructure. Local giants such as Reliance Industries and CtrlS are also expanding their data centre footprints.

TCS and TPG project that India’s total data centre capacity could surpass 10 gigawatts by 2030, a dramatic jump from roughly 1.5 gigawatts today.