ChatGPT maker eyes 500 MW data centre lease from HyperVault as part of 'Stargate India' initiative.
OpenAI is in advanced negotiations with Tata Consultancy Services (TCS) to establish large-scale artificial intelligence infrastructure in India, according to multiple reports citing people familiar with the matter. The proposed partnership would see OpenAI lease at least 500 megawatts of data centre capacity from HyperVault, TCS's newly established data centre subsidiary.
If finalised, the deal would make OpenAI the anchor tenant in HyperVault's upcoming gigawatt-scale, AI-ready data centres, effectively marking the launch of OpenAI's "Stargate India" chapter. The collaboration forms part of OpenAI's broader strategy to build sovereign AI infrastructure across key global markets.
Strategic Pivot for Both Companies
The partnership is expected to support TCS's ambition of becoming the "world's largest AI-led services company." Beyond infrastructure, the two companies are exploring co-development of agentic AI solutions—autonomous systems capable of executing complex tasks with minimal human intervention—targeting enterprise clients in banking, financial services, retail, consumer goods, and manufacturing.
TCS Chairman N. Chandrasekaran has expressed enthusiasm about the company's AI infrastructure ambitions. In a statement regarding HyperVault's development, he said, with this capability, TCS is uniquely positioned to deliver complete AI solutions for its customers and partners. We are excited and committed to playing a leading role in creating world-class AI infrastructure and solutions for the industry.
Massive Investment Backing
The infrastructure play is underpinned by significant capital. TCS recently secured a $1 billion investment from global alternative asset manager TPG to accelerate HyperVault's expansion. Together, TCS and TPG will commit up to ₹18,000 crore over the coming years, with TPG expected to hold between 27.5% and 49% in the venture.
TPG Executive Chairman Jim Coulter emphasised the strategic alignment: "We are excited to partner with TCS and are grateful for our long-standing partnership with the Tata Group, both who share our vision and commitment to innovation and sustainability."
TCS has announced plans to invest up to $7 billion in building a 1-gigawatt data centre network spanning four locations across India. HyperVault will offer secure, liquid-cooled, high-density AI data centres with energy-efficient designs and connectivity across major cloud regions.
No Equity Stake on the Table
Notably, there are no plans for equity infusion from OpenAI into HyperVault at this stage. According to The Economic Times, an official familiar with the discussions stated: "Tatas are not keen to dilute equity or over-index on a single customer like OpenAI, and they want to broaden their offerings to peers like Anthropic. An equity investment from one could potentially raise questions around conflict."
This approach allows TCS to maintain operational independence while serving multiple AI companies and hyperscalers.
Why India Matters
India represents a critical frontier for OpenAI's global expansion. The country has more ChatGPT users than anywhere in the world except the United States. With the Indian government tightening data localisation requirements, having local infrastructure enables OpenAI to train and host its large language models within India to better serve data residency needs.
A Nasscom-BCG study forecasts that India's AI market will grow 25–35% annually to reach $17–22 billion by 2027, fuelled by technology services, rising startup investment, and a growing developer ecosystem.
Negotiations Enter Final Stretch
Senior TCS leadership is currently in the United States to finalise commercial terms, with a formal announcement targeted before the end of the year.
The talks come after OpenAI's earlier negotiations with Reliance Industries stalled over disagreements on commercial terms. Reliance subsequently deepened existing partnerships with Meta and Google for its IGW compute hub in Jamnagar, Gujarat.
The prospective TCS-OpenAI partnership arrives as India emerges as a fierce battleground for global AI players. Google and Reliance have announced their own partnership to deploy AI chips in India, while Amazon has committed $12.7 billion to cloud infrastructure through 2030.
