The ChatGPT creator is reportedly in advanced negotiations with Tata Consultancy Services (TCS) to build a sovereign AI infrastructure, signaling a major shift in its global strategy after initial talks with Reliance stalled.
OpenAI is in late-stage discussions to forge a landmark partnership with India’s largest IT services firm, Tata Consultancy Services (TCS), to establish its first “sovereign” AI infrastructure in the region. The deal, which could be finalized by the end of the year, involves OpenAI leasing massive computing capacity to train its models locally while co-developing “agentic AI” solutions for global enterprises.
According to sources familiar with the matter, the San Francisco-based AI giant plans to lease at least 500 megawatts (MW) of data centre capacity from HyperVault, a newly formed subsidiary of TCS. This would effectively launch the “Stargate India” chapter of OpenAI’s global infrastructure project, allowing the company to process data within India’s borders, a key requirement for government and banking clients.
A central pillar of the alliance is the co-development of “agentic AI” autonomous systems that can execute complex multi-step workflows without human intervention. TCS aims to deploy these solutions across its vast client base in banking, retail, and manufacturing, effectively moving beyond simple chatbots to AI that can “do work” on behalf of employees.
Senior TCS executives are reportedly in the United States this week to iron out the commercial terms. While OpenAI will be the “anchor tenant,” the Tata Group has reportedly decided against offering an equity stake, preferring to keep the infrastructure open to other players like Anthropic to avoid vendor lock-in.
“The collaboration would mark the launch of OpenAI’s Stargate India chapter… [and] accelerate TCS’ ambition of becoming the world’s largest AI-led services company,” reported The Economic Times, citing insiders.
Industry observers note the strategic pivot: “OpenAI is turning to Tata after negotiations with Reliance stalled earlier this year… It is a clear signal they need a neutral, enterprise-focused partner to crack the Indian B2B market,” said a Mumbai-based tech analyst.
The move comes as the battle for India’s AI infrastructure heats up. Reliance Industries, led by Mukesh Ambani, has already pivoted to a different strategy, deepening ties with Nvidia to build a 1-gigawatt AI computing center in Gujarat and partnering with Google to bundle “Gemini Pro” subscriptions for millions of Jio users.
By partnering with Tata, OpenAI secures a counterweight to the Reliance-Google-Nvidia axis. It also aligns with the Indian government’s push for “sovereign AI,” where critical data and compute power remain within national jurisdiction.
If signed, the deal will likely see OpenAI’s first major infrastructure deployment in South Asia by mid-2026. The partnership is also expected to accelerate the hiring of local engineering talent, following the appointment of Pragya Misra as OpenAI’s first India lead earlier this year.
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