ChatGPT-maker is reportedly in talks with Tata Group to build AI compute infrastructure in India and co-develop agentic AI solutions for enterprises. According to a report in Economic Times, the world’s most-valued artificial intelligence company OpenAI is in advanced talks to partner with Tata Consultancy Services (TCS). A partnership with the Tata Group is said to mark the beginning of OpenAI’s Stargate India chapter while accelerating TCS’ ambition of becoming the “world’s largest AI-led services company.”OpenAI-Tata deal reportedly comes after the company’s failed negotiations with Reliance Industries. In September, OpenAI had reportedly begun groundwork for the India leg of Stargate, engaging with the government and holding negotiations with Reliance Industries. However, the two sides failed to agree on terms. Since then, Reliance has deepened ties with long-time allies Google and Meta. Reliance is building 1GW compute hub in Jamnagar, Gujarat, as well as AI service offerings with the two OpenAI rivals.
OpenAI-TCS partnership
OpenAI is reported to be in talks to sign lease agreement of at least 500 MW of data centre capacity from TCS’ new data centre arm HyperVault to train and run its AI models locally. The two companies are also said to be keen to build agentic AI solutions for large enterprises across sectors such as BFSI, retail, consumer goods, manufacturing etc, powered by frontier GPT large language models (LLMs)Last month, TCS and private equity group TPG announced partnered to invest up to Rs 18,000 crore ($2.1 billion) in HyperVault to build gigawatt-scale AI-ready data centres. TCS is the majority partner in the JV with a 51% stake, while TPG will hold the remaining and invest up to 88.20 billion rupees. The announcement came after the Tata flagship company first revealed its plans that entailed a total capex outlay of $6.5-7 billion in investments to be funded via debt and equity. India’s data centre capacity is expected to more than triple to 4.5 gigawatt by 2030 from current levels, according to real estate consultant Colliers.As per ET report, OpenAI is set to be the first anchor tenant of the data centres that will also be housing customers such as hyperscalers, corporate clients, sovereign cloud operators, Tata Group companies and government entities. The senior leadership team of TCS is said to be in the US to finalise the partnership and other commercial details with a target to make a formal announcement by the end of the year. This comes as the Indian governments is insisting on data localisation. The report also makes it clear that there are no plans for any equity infusion by Open AI in HyperVault at present. A group official told ET, “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.”For TCS, a partnership with Open AI will be critical as the company reportedly looks to pivot toward becoming a next-generation computing power. “The core pillars of this strategy include building end-to-end solutions, strengthening ecosystem play, upskilling global workforce and reinventing delivery models through AI agents,” says the report.
OpenAI teaming up with governments to grow AI infrastructure
The planned partnership will mirror the ‘OpenAI for Countries’ that ChatGPT maker announced in May his year. ‘OpenAI for Countries’ aims to enable the company to build local infrastructure needed to better serve international AI customers. As a part of the program, OpenAI plans to partner with governments to assist with efforts like building out data center capacity and customizing OpenAI’s products, including ChatGPT, for specific languages and local needs.According to Bloomberg, OpenAI for Countries is meant to complement the company’s AI data center push, Project Stargate, which is reportedly set to expand beyond the US.
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