TLDR: Reliance Industries is reportedly planning a substantial investment of $12-15 billion in AI infrastructure over the coming years, including the development of a 1-gigawatt data center. This strategic move, spearheaded by a new subsidiary ‘Reliance Intelligence’, aims to establish India as a global AI hub through infrastructure development, strategic partnerships, tailored AI services, and talent nurturing.
Reliance Industries Ltd, under the leadership of billionaire Mukesh Ambani, is poised to make a significant investment of approximately $12-15 billion in artificial intelligence (AI) infrastructure over the next few years. This ambitious plan includes the establishment of a massive 1-gigawatt (GW) data center, as highlighted in a recent report by Morgan Stanley. The investment underscores Reliance’s commitment to a major push into the AI sector, a strategy first unveiled by Ambani at the company’s annual shareholder meeting in August.
To spearhead these extensive AI initiatives, Reliance is establishing a new, wholly-owned subsidiary named ‘Reliance Intelligence’. This entity will focus on four core pillars:
1. Infrastructure: A primary focus will be on building gigawatt-scale, AI-ready data centers. Morgan Stanley estimates that roughly $7 billion will be allocated to data center infrastructure, with an additional $5 billion earmarked for deploying 250 megawatts (MW) of AI chips directly.
2. Partnerships: Reliance plans to forge collaborations with leading global technology companies to introduce cutting-edge AI solutions to India. Notable partnerships include combining Meta’s open-source Llama AI models with Reliance’s business network to develop and distribute enterprise AI services for Indian companies. Furthermore, Reliance is working with Google to establish a dedicated cloud region in Jamnagar, leveraging both Reliance’s infrastructure and Google’s advanced AI and cloud technologies.
3. Services: The conglomerate will focus on developing AI-powered services specifically designed for Indian consumers, small businesses, and large enterprises across critical sectors such as education, healthcare, and agriculture.
4. Talent: A crucial aspect of the strategy involves investing in upskilling and nurturing India’s AI workforce to support the burgeoning AI ecosystem.
The first phase of this monumental data center project is already underway in Jamnagar, Gujarat. While Reliance intends to underwrite about 25% of the 1GW capacity itself, deploying approximately 250MW of chips directly, the remaining capacity is expected to be leased to hyperscalers and large language model (LLM) providers as ‘Datacenter as a Service’. Morgan Stanley projects annual revenues of around $1.5-1.6 million per MW for this ‘Datacenter as a Service’ model.
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According to Morgan Stanley, Reliance has a history of reinventing itself each decade, and AI is anticipated to significantly reshape its equity story. The deployment of Generative AI is expected to facilitate large-scale capital deployment while simultaneously unlocking substantial value through synergies across Reliance’s diverse verticals, including energy, digital, consumer, and media. The firm also noted an estimated Return on Capital Employed (ROCE) of approximately 11% on these initial AI investments.
