Canada Pension Plan Investment Board’s CPP Investments is investing up to 70 billion rupees (approximately $741 million) in Indian data center operator CtrlS, betting on India’s growing role in building cloud and AI infrastructure globally, as global investors race to finance the infrastructure that supports the artificial intelligence boom.
Under the partnership announced on Wednesday, CPP Investments will invest 40 billion rupees (approximately $423 million) to acquire an 8.2% stake in CtrlS and commit up to 30 billion rupees (approximately $317 million) to the joint venture to develop hyperscale data center campuses across India.
In a joint statement, the companies said CPP Investments will own 48% of the joint venture, while CtrlS will own the remaining 52%.
Founded in 2007, CtrlS operates over 15 data centers across India. The Hyderabad-based company has expanded its footprint to meet the growing demand from cloud providers, enterprises, and AI workloads.
India has become a leading destination for investments in data centers and AI as global technology companies and investors ramp up spending to meet surging computing demands. Companies such as Amazon, Google, Microsoft, OpenAI and Uber have announced investments in the country in recent months, and carriers are also rapidly expanding capacity in a global race to build out AI infrastructure.
“As one of the fastest growing digital markets in the world, India is a key pillar of our global data center strategy,” Max Biagos, global head of real assets at CPP Investments, said in a statement.
CPP Investments, Canada’s largest pension investment company, has been investing in India since 2009 and had approximately $20 billion in net assets in the country as of March 31, making it one of the largest foreign institutional investors in the market.
This investment builds on CPP Investments’ extensive commitment to digital infrastructure. The pension fund said it has been investing in the data center sector since 2017 and has built a portfolio of assets and joint ventures across major markets around the world.
Sridhar Pinnapureddy, Founder and CEO of CtrlS, said the partnership will expand CtrlS’s capabilities and help build an infrastructure tailored to AI workloads.
The CPP-CtrlS deal is the latest in a series of investments targeting India’s data center sector. Earlier this month, Blackstone-backed AirTrunk announced it would invest $30 billion to build 5 gigawatts of data center capacity in India by 2030. Meanwhile, Mehta last week partnered with Reliance Industries to build a 168-megawatt AI-enabled data center in the western state of Gujarat.
New Delhi is seeking to position India as a global hub for digital infrastructure through a range of policy measures, including tax exemptions for foreign cloud providers on services sold abroad until 2047, provided they run workloads from data centers located in India.
Indian conglomerates are also accelerating their expansion plans to take advantage of this opportunity. Adani Group and Tata Consultancy Services are among the companies that have announced large-scale data center projects aimed at supporting AI and cloud workloads. In 2023, CtrlS announced plans to invest $2 billion over six years to expand its data center footprint across India.
India’s growing role in AI infrastructure has yet to be matched by similar advances in the development of frontier AI models. Although the country has several startups, such as Sarvam, that are building their own AI models, much of the underlying AI technology used by Indian companies continues to come from American companies.
Rapid construction of data centers is also expected to increase pressure on power and water resources, highlighting some of the challenges that may come with India’s ambitions to become a major AI infrastructure hub.
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