A Canadian pension giant is joining the race to fund India’s AI-powered data center boom

As global investors race to fund infrastructure supporting the AI ​​boom, Canada Pension Plan Investment Board’s CPP Investments has pledged up to INR 70 billion (about US$741 million) to Indian data center operator CtrlS, betting on India’s growing role in the global buildout of cloud and AI infrastructure.

Under the partnership announced on Wednesday, CPP Investments will invest INR 40 billion (about US$423 million) to acquire an 8.2% stake in CtrlS and commit up to INR 30 billion (about US$317 million) to a joint venture to develop large-scale data centers across India.

CPP Investments will own 48% of the joint venture, while CtrlS will own the remaining 52%, the two companies said in a joint statement.

Founded in 2007, CtrlS It operates more than 15 data centers All over India. The Hyderabad-based company is expanding its footprint to meet the growing demand from cloud providers, enterprises and AI workloads.

India has become a major destination for data center and AI investments, as global technology companies and investors ramp up spending to meet growing demand for computing. Companies including Amazon, Google, Microsoft, OpenAIand Uber It has announced investments in the country in recent months, while operators are rapidly expanding their capabilities amid a broader global race to build AI infrastructure.

“As one of the world’s fastest-growing digital markets, India represents an important pillar of our global data center strategy,” Max Biagosh, global head of real assets at CPP Investments, said in a statement.

CPP Investments, Canada’s largest pension investor, has been investing in India since 2009 and had net assets of about $20 billion in the country as of March 31, making it one of the largest foreign institutional investors in the market.

The investment builds on CPP Investments’ broader push into digital infrastructure. The pension fund said it has invested in the data center sector since 2017 and has built a portfolio of assets and joint ventures across key markets around the world.

The partnership will help CtrlS expand capabilities and build an infrastructure specifically designed for AI workloads, said Sridhar Pinnapureddy, Founder and CEO, CtrlS.

The CPP-CtrlS deal is the latest in a series of investments targeting the data center sector in India. Earlier this month, it backed Blackstone Airtronic It said it would invest $30 billion to build five gigawatts of data center capacity in India by 2030. deadMeanwhile, it partnered with Reliance Industries last week to set up a 168 MW AI-enabled data center in the western state of Gujarat.

New Delhi has sought to make India a global hub for digital infrastructure through a range of policy measures, including Tax breaks for foreign cloud providers on services sold abroad until 2047, provided that these workloads are run from data centers located in the country.

Indian conglomerates have also accelerated expansion plans to capitalize on the opportunity. Adani Group and Tata Consultancy Services It is among the companies that have unveiled major data center projects aimed at supporting artificial intelligence 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 progress in developing frontier AI models. While the country has a few startups building indigenous AI models, including… Sarvammuch of the core AI technology used by Indian companies It continues to be supplied by American companies.

The rapid construction of data centers is also expected to increase pressure on electricity and water resources Some challenges Which could accompany India’s ambitions to become a major AI infrastructure hub.