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The race to build infrastructure for artificial intelligence is no longer centred only on the United States or Europe. Asia has moved into focus, as companies such as Google expand data centre investments across the region.
A planned data centre investment of around US$15 billion in Andhra Pradesh reflects both the scale and urgency of that expansion. Reporting by The Economic Times indicates that Google is preparing to begin construction later this month. The rollout is scheduled to start on April 28, following an agreement signed with the state government about six months ago. Senior leadership, including CEO Thomas Kurian, is expected to attend the groundbreaking.
The project is designed as a 1 gigawatt (GW) data centre hub spread across three campuses near Visakhapatnam, covering Adavivaram, Tarluvada, and Rambilli. Local authorities have allocated more than 600 acres of land for the development, according to The Economic Times.
Companies such as Amazon Web Services, Microsoft, and Google have expanded their presence across Asia in recent years. New regions and added capacity suggest that growth in the region is now part of core infrastructure planning.
Demand is shifting closer to users
One reason for this expansion is the rise in digital activity across Asia. Countries such as India, Indonesia, and Vietnam have seen growth in internet use, cloud adoption, and online services. Enterprises are moving more operations online, while governments are pushing for local digital infrastructure.
This creates pressure to store and process data closer to where it is generated. Latency becomes an issue when workloads depend on real-time responses. AI applications need fast access to computing resources. Training models can take place in central locations, but running them often needs to happen closer to end users.
Cloud providers have responded by building more local infrastructure. Amazon Web Services has launched regions in Indonesia and Thailand, while Microsoft has expanded its presence in Malaysia and Indonesia. These moves place compute capacity closer to users rather than relying on distant hubs.
Data rules are shaping infrastructure
Regulation is influencing where data centres are built. Many governments in Asia have introduced rules that require certain types of data to remain within national borders. These policies give local authorities more oversight.
India has been working on data protection and localisation frameworks, which push companies to keep more data within the country. By building large-scale facilities locally, Google can meet regulatory needs while supporting regional demand.
Indonesia and Vietnam have introduced policies that affect how companies manage cloud services. These rules do not stop cross-border data flows, but they shape how infrastructure is planned and deployed.
AI is changing how data centres are designed
AI is changing what data centres require. Traditional cloud workloads focused on storage and general computing, while AI workloads need more power and specialised hardware.
Graphics processing units and other accelerators require dense setups and strong cooling systems. This increases construction and operating costs. As a result, companies are looking for locations where power is available at scale.
Microsoft and Google have increased spending on infrastructure that supports AI workloads, including hardware and energy supply. Data centres are being designed with higher power density in mind.
With a planned capacity of 1 GW, the Andhra Pradesh hub will rank among the largest data centre clusters in Asia. The site is also expected to connect to global networks through subsea cable links to Singapore, Malaysia, Australia, and other countries.
In parts of India, land is available at lower cost compared to major hubs in the United States or Europe. Governments are also offering incentives to attract data centre investment, including support for power and connectivity.
Enterprise demand is driving long-term growth
Enterprise demand continues to support data centre growth. Many companies in Asia are still moving from on-premise systems to cloud-based services. This creates steady demand for computing capacity.
Cloud providers are building regional capacity that can support global and local clients. This includes services for data storage, analytics, and software platforms. As more companies adopt these tools, demand for data centre space is expected to rise.
According to the International Energy Agency, global data centre electricity use could more than double by the end of the decade, driven in part by AI workloads. While this estimate covers all regions, Asia is expected to account for a growing share of that demand.
The Andhra Pradesh project also involves partners. It is being developed through AdaniConnex and Bharti Airtel, alongside a local subsidiary responsible for implementation.
Google’s data centre push
The expansion into Asia does not mean that other regions will slow down. The United States remains a major hub for cloud infrastructure, and Europe continues to invest in local capacity.
Asia’s mix of population growth, digital adoption, and policy support makes it a key area for future development. Projects such as the one in Andhra Pradesh show how quickly investments can scale.
Google currently operates data centres across 11 countries and 29 global sites. The planned cluster near Visakhapatnam is expected to become its largest in Asia.
There are challenges. Power supply, water use, and land availability can limit how fast data centres can be built. Local communities and regulators may also push back against large projects if they strain resources.
As AI and cloud services continue to expand, companies are placing more infrastructure closer to where demand is rising. Asia is becoming a central part of that network.
The result is a more distributed model of cloud infrastructure. Instead of a few large hubs serving the world, data centres are being spread across regions to meet local needs.
(Photo by Alex Dudar)
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