India’s AI-Driven Cloud Expansion Signals Strong Technology Services Growth
India’s AI-India’s technology industry is entering a new phase of expansion as businesses increase investments in artificial intelligence, cloud computing, and digital infrastructure. A recent report by Equirus Securities indicates that rising enterprise demand for AI-powered solutions and cloud-based platforms is expected to fuel significant growth across the country’s technology services sector.
Public Cloud Spending Set for Sharp Increase
According to the report, spending by end users on public cloud services in India is projected to reach USD 17.5 billion in 2026, reflecting a year-on-year increase of 28.1 percent from an estimated USD 13.7 billion in 2025. The growth is expected to be supported by organizations shifting more business operations to cloud environments while expanding AI-powered applications.
Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) are forecast to remain the fastest-growing segments as companies continue building cloud-native platforms and deploying advanced AI workloads across their operations.
Global Data Centre Expansion Driven by Artificial Intelligence
The report also highlights the rapid global expansion of colocation data centres, largely fueled by the increasing adoption of artificial intelligence. Worldwide demand for colocation capacity is expected to rise from nearly 82 gigawatts in 2025 to approximately 220 gigawatts by 2030.
By the end of the decade, AI-related workloads are expected to account for nearly 70 percent of total data centre demand. As a result, reliable power availability, access to advanced semiconductor technology, and the ability to complete infrastructure projects quickly are expected to become the most important competitive advantages for companies operating in this space.
India Strengthens Its Position as a GCC Destination
India is also witnessing growing momentum in the establishment of Global Capability Centres (GCCs). Equirus noted that private equity firms are increasingly encouraging companies within their investment portfolios to build GCC operations, extending this trend beyond large multinational corporations.
These centres are being developed to strengthen capabilities in areas such as artificial intelligence, engineering, finance, product development, and analytics. Businesses are also using GCCs to improve operational efficiency, support innovation, and accelerate long-term business value creation.
Talent and Digital Expertise Continue to Attract Investment
India’s large pool of skilled professionals, competitive operating costs, and strong digital capabilities continue to make the country an attractive destination for technology investments. The report points out that mid-sized businesses and private equity-backed firms are becoming increasingly important contributors to the country’s expanding GCC ecosystem.
This broader participation is expected to create additional opportunities across technology services while supporting continued growth in high-value digital operations.
Enterprise AI Adoption Moves Beyond Pilot Projects
Artificial intelligence services have already become a meaningful contributor to the country’s technology industry. Equirus estimates that the domestic AI services market currently generates between USD 10 billion and USD 12 billion in revenue.
The report further notes that nearly one-fourth of enterprises have progressed beyond experimental AI projects, with many organizations now deploying AI solutions at production scale. This transition reflects increasing confidence in the technology’s ability to improve business performance and operational efficiency.
Modernization Initiatives Expected to Support Future Growth
Looking ahead, India’s technology services sector is expected to benefit from rising enterprise demand for digital modernization, data engineering, AI governance, and intelligent business operations. The country’s growing AI-skilled workforce and deep expertise in enterprise technology are expected to strengthen its position in the global technology landscape.
Equirus attributes much of the anticipated growth to continued investments in AI-ready infrastructure, modernization of digital platforms, and wider deployment of enterprise-scale artificial intelligence solutions as businesses accelerate their digital transformation strategies.