The Budget has introduced measures to stimulate investments in data centers, with Prime Minister Narendra Modi positioning India as a prominent player in global digital infrastructure and artificial intelligence.

He emphasized that India is prepared to become a pivotal hub for data hosting on a global scale, driving the forthcoming advancements in technology revolution.

The Prime Minister sent a powerful message of global outreach by stating, "We extend an invitation for all the world's data to be hosted in India."

In the recently presented budget proposal for the upcoming fiscal year beginning in April, Finance Minister Nirmala Sitharaman disclosed that companies such as Amazon, Google, and Microsoft may be eligible for a tax exemption until 2047 on their worldwide cloud earnings if they choose to process international workloads through data centers located in India.

Data center services are now included in the Safe Harbor Rules, allowing for a 15 percent margin of coverage. This change was implemented in the Budget for the year 2026-2027, aiming to attract more investment in artificial intelligence, improve infrastructure, and create job opportunities while addressing issues related to competition, data protection, and enforcement risks.

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Modi underscored the importance of data centres. "When we think of technology, we often focus on what is visible, such as applications, platforms and devices. But equally important are the foundational layers that make all such things possible. Data centres are one such critical layer," he said.

Linking this to AI, the prime minister said, "The importance of this becomes even more apparent when we look at the domain of artificial intelligence. AI needs computing power and data-centre infrastructure. By expanding capacity today, we are laying the foundations for a thriving Indian AI ecosystem."

Acknowledging this potential, significant investments have recently been disclosed in this sector by both international and Indian corporations.

His presentation was delivered a day prior to India hosting the international gathering of prominent figures in the technology industry, AI entrepreneurs, policymakers, investors, and innovators. The Global AI Impact Summit is scheduled to take place in New Delhi from February 16 to 20, and will feature a lineup of world leaders such as France's Emmanuel Macron and Brazil's Luiz Inácio Lula da Silva, in addition to delegates from over 60 other nations.

"The world has been undergoing significant shifts in its technological landscape. Now, nations cannot be content with just digital adoption but must also aspire to digital leadership. As we saw in the digital payments space, only with digital leadership will digital inclusion become possible," he said.

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In expressing his views, Modi emphasized the need for India to transition from merely adopting digital technology to actively leading in the digital realm. He highlighted that in today's technology-driven and data-centric environment, leadership plays a crucial role in determining a country's inclusion, competitiveness, and overall economic growth.

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"India, with an aspirational population of 140 crore people, is one of the world's largest generators and consumers of data. We are one of the most diverse nations in the world and our data also reflects this diversity. Such a massive and diverse data pool has great potential only when it can be leveraged safely and productively. So we are paying attention to every aspect of the data ecosystem, including security, skills, software and infrastructure," the prime minister said.