"When we think about the cloud opportunity in India itself, it is going to be a $2 trillion opportunity," chief executive Satya Nadella said in Delhi on Tuesday, adding that the move will help Indian companies, government and entrepreneurs. Without disclosing the investment involved in setting up the data centres, Nadella said they will have "sizeable" capacity.
The announcement is significant given that the ruling Bharatiya Janata Party has been vocal about bringing local data centres to India to maintain data sovereignty. Besides, a large number of Indian enterprises have increasingly voiced concerns about hosting their data on the public cloud because none of the major players such as Amazon Web Services, Microsoft or Google have cloud data centres in India.
"I think in two or three years, when the servers come to India, the public cloud market will become more interesting because now there are some territorial issues in holding the data in the country," Jagdish Belwal, CIO at Tata Motors, which currently uses Amazon Web Services, told ET in a recent interview.
Competition in the cloud market is increasing, with players such as IBM spending millions of rupees advertising its Softlayer cloud and Oracle making a push in the Indian market with the announcement of several new cloud offerings for different industries. Microsoft's move to set up a local data centre will give the company "more muscle" to compete in the cloud services market and "Office 365 could see higher adoption", according to Vishal Tripathi, principal research analyst at Gartner.
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