Microsoft has announced its decision to invest a total of $36.5BN into India and Canada for AI and cloud enhancements.
Both commitments aim to improve AI infrastructure and targeted capabilities across the two countries over a four-year period.
These national-scale initiatives could directly benefit local customer service experiences and improve overall AI skills.
Investing in AI is critical to advancing in today’s landscape across all areas.
In fact, by 2023, almost 60% of workers worldwide will require new digital skills, meaning that countries that intend to keep up in this competitive market will be required to deploy artificial tools and train citizens in these new areas.
Why Does This Matter to CX?
By localizing data, India and Canada are now at a stage to deploy AI agents to process personal and sensitive data.
Since many CX systems rely on this data, locally run AI models will provide limited exposure to threats with reduced latency and strict rules in place around compliance and data sovereignty.
This strategy enables Microsoft to deploy Copilot and Azure AI within both countries, allowing customers to experience faster responses and trust in data handling within their respective countries’ borders.
Furthermore, citizens can also experience localized AI from a personalized perspective, with tools and features designed to fit within guidelines, but also tailored to the country itself, such as language requirements and voice recognition systems.
Expanding data center regions with added capacity enables cloud systems that power CX tools to be strengthened.
This strategy allows customer services to offer more interactions during high-traffic times and support chatbots and tools in real time with reduced service slowdowns.
Local businesses can also scale AI capabilities without experiencing service issues.
This investment also offers public-sector AI adoption, meaning that India and Canada government departments can utilize AI tools for processing support.
This also allows citizens to interact with AI tools in government customer services regularly, speeding up the process of AI skilling without extra cost.
Other public sector areas, such as retail, can also benefit from this, allowing local businesses to keep up with competition and improve their service quality.
India and Canada have laid out plans to introduce AI to their workforce, creating strategies to improve AI literacy in their respective countries.
This initiative will likely see improvements in local customer-facing teams becoming more coherent with Microsoft tools such as Copilot and other workflow automations to provide efficient standards of service.
This would result in higher accuracy and handling times, allowing for more customer interactions with positive outcomes.
So, let’s take a closer look at how these investments will be utilized across the two countries.
Investing in India
India has announced its plans to advance the country’s cloud and AI infrastructure, skill development, and operational strategies in line with compliance and governance guardrails.
This strategy is expected to enhance India’s public and social sectors by deploying AI capabilities in widely used platforms intended for millions of citizens.
Puneet Chandok, President at Microsoft India and South Asia, explained that this investment will allow the country to continue its roadmap toward a secure AI future.
“As the nation moves confidently into its AI-first future, we are proud to stand as a trusted partner in advancing the infrastructure, innovation and opportunity that can power a billion dreams,” he said.
“Building on the US$3 billion investment announced in January 2025, our new US$17.5 billion commitment and deep partnership across India’s technology ecosystem are focused on turning India’s AI ambition into impact for every citizen.”
Having previously partnered with India as part of the same vision earlier this year, Microsoft will invest a further $17.5BN to continue its AI roadmap – scale, skills, and sovereignty.
Scale
Microsoft has agreed to build a new India-based data center for 2026 as part of its AI infrastructure and cloud region expansion strategy for hyperscale.
The investment also involves launching the India South Central cloud region, as well as continuing to expand the country’s existing data center regions.
Skills
The government has announced its plans to improve AI skilling by launching a program to train 20 million residents by 2030, following its original plan to train 10 million in AI, targeting people across the country rather than just major cities.
The Indian Prime Minister, Narendra Modi, intends to enhance AI’s accessibility at a national scale for the next generation.
In an X post, the PM explained, “The youth of India will harness this opportunity to innovate and leverage the power of AI for a better planet.”
Sovereignty
Microsoft will be introducing the Sovereign Public Cloud and Sovereign Private Cloud solutions to offer ‘sovereignty-ready’ services for a variety of Indian customers.
This will allow both government departments and private firms to utilize AI tools in accordance with national regulations.
Investing in Canada
Microsoft has also made plans to deepen its current AI investment in Canada, contributing CA$19BN over four years to ensure it meets AI infrastructure and digital sovereignty goals.
This will also involve investing in its citizens to prepare them for the era of AI-skilled work.
Hon. Evan Solomon, Minister of Artificial Intelligence and Digital Innovation, highlights how this investment will help Canada to improve AI literacy for many residents, while also seeing the likelihood of future initiatives to positively impact the country’s position in the global AI market.
“Microsoft employs 5,300 Canadians, and their new major commitment shows continued belief in Canada’s talent, economy and AI ecosystem,” he said.
“It boosts AI solutions and helps many firms move faster, compete more effectively, and bring new ideas to market.
“These types of investments complement the work we are doing to develop and scale the AI economy and grow the next generation of Canadian AI champions.”
Microsoft has also launched a five-point plan to promote and protect digital sovereignty in Canada to strengthen trust in AI by enhancing security measures, localizing data, and safeguarding residents’ privacy in line with the country’s policies.
Defending Canada’s Cybersecurity
Microsoft has now launched a dedicated Threat Intelligence Hub in Ottawa, providing the Government of Canada and other enforcement agencies with intelligence data and assets to monitor potential cyberattacks.
After noticing an increase in international cybercriminal threats against the country, Microsoft analysis uncovered that over 50% of attacks against Canada in 2025 were to extract money, while 80% targeted data.
This Hub will enable Canada with abilities to protect itself against future digital attacks from around the globe.
Keeping Canadian Data on Canadian Soil
Microsoft has expanded its data center plan for 2026, with plans to build three more within Canadian borders to ensure local data is protected.
This will also enable Canada to utilize Microsoft products such as Copilot by offering in-country data processing during interactions.
This also includes Azure for Canadian-focused abilities with private customer-owned environments, and Sovereign AI Landing Zone (SAIL) for secure local AI deployments.
Protecting Canadian Privacy
Microsoft has planned to offer confidential computing capabilities for Canadian data center regions, ensuring that data is kept encrypted with Azure in 2026.
It also offers Azure Key Vault to support encryption key management to ensure customers remain in control.
This allows Microsoft to protect Canadian customer data, even in instances where government handover demands are made.
Supporting Canada’s AI Developers
Microsoft will also provide support to Canada’s local AI firms, such as Cohere, by implementing its system within Microsoft Foundry, offering customers access to its language models via Azure.
This implementation allows local firms to gain global audiences and improve SME relationships with Microsoft.
It also ensures that local AI companies are adhering to Canada’s policies whilst delivering them large-scale opportunities.
Defending the Continuity of Canadian Cloud Services
To avoid Canada from creating policy changes to keep up with external AI pressures, Microsoft has assured the country remains in continuity with the plan it has committed to, with uninterrupted operations to be installed with its cloud services.
This allows its local customers to feel secure in its AI future, with Microsoft planning to stand up for customer rights where necessary.
This strategy aims to develop deeper relationships between Microsoft, the country, and its citizens by adhering to contractual agreements.
