Synopsis
Google is seriously considering manufacturing AI servers in India, according to IT Minister Ashwini Vaishnaw, who noted HP has already begun production. This move aligns with Google's broader strategy of diversifying its global supply chain and follows its significant $15 billion investment in an AI hub in Visakhapatnam, Andhra Pradesh."I have requested Google and other major players to manufacture AI servers in India. AI servers manufactured here match global quality. HP has started manufacturing AI servers here," Vaishnaw said at the CII Annual Business Summit – 2026. The Minister had met senior Google officials, including vice president of government affairs & public policy Wilson White, last week.
AI servers are high-performance computing systems specifically designed to handle the massive computational demands of AI workloads, such as training Large Language Models (LLMs) and running real-time inference.
Diverse supply chain
While Google traditionally designs its own hardware, such as the Tensor Processing Unit (TPUs), it relies on a global network of partners, such as Quanta Computer and Foxconn, for assembling its server racks and manufacturing.
Much of the high-level system integration and specialised TPU testing is localised in the United States, particularly near Google’s engineering hubs.
But Vaishnaw's comments assume significance since the tech giant has been diversifying its supply chain to countries such as Thailand and Malaysia to reduce reliance on single-region manufacturing.
AI hub in Visakhapatnam
As part of its largest-ever investment in India, and single-largest investment outside the US, Google has announced a $15 billion investment plan in Andhra Pradesh's Visakhapatnam to establish an artificial intelligence (AI) hub. The multiple data centres in the campus will host a total data centre capacity of up to 5 gigawatts (GW), Google Cloud CEO Thomas Kurian told ET on April 25. Days later, Google broke ground on the Visakhapatnam project in partnership with AdaniConneX and Nxtra by Airtel.
On Monday, Vaishnaw said close to about $200 billion in investments are coming into the data centre economy. This will be complemented by at least three large sub-sea cables currently being built to connect India to Australia, the Middle East, Europe, South Africa and the United States, he said. The same consortium behind Google's AI hub is building these, as part of the America-India Connect initiative.
Made in India electronic components worth Rs 30,000 crore were exported last year to China, and shipments are expected to grow this year. "Smartphones became the largest exported commodity last year (FY25), while electronics reached the top three exports. This is just the beginning," said Vaishnaw.
Under the investment proposals approved under the electronics component manufacturing scheme, 71 factories are being constructed nationwide.
