Sovereign cloud and digital public infrastructure: Building India’s AI backbone

By Express Computer On Aug 13, 2025

By- Mohamed Imran, Chief Technology Officer, E2E Networks Limited

India’s digital transformation is built on an ever-expanding infrastructure. For example, the National Informatics Centre has set up state‐of‐the‐art data centers with over 100 PB of storage and 5,000+ servers. This national cloud backbone already powers e‑governance and citizen services. In the AI era, we cannot afford to gamble with this data abroad. To protect our digital economy, India needs both world-class public infrastructure and a sovereign cloud, one that is within the borders and laws of the country.

Why Sovereign Cloud Matters

Put simply, a sovereign cloud means having ownership over where the data is stored, processed, and governed. In practice, this is strategic for AI, because data is the new oil and algorithms are power. Industry analysts note that data sovereignty is a rising concern globally. For example, Gartner projects that by 2027, 70% of generative-AI initiatives will prioritize choosing cloud providers based on data sovereignty.

For India, the implications are clear: a sovereign cloud acts as a national shield. Localizing sensitive datasets ensures compliance with India’s data sovereignty regulations.

In other words, sovereign cloud is a matter of national security. It lets us define exactly how our AI workloads run and who can access the data. For technology leaders, this means pivoting cloud strategy from technical to strategic decisions. Getting it right today will determine who owns our digital future.

India’s Digital Public Infrastructure (DPI)

India’s Digital Public Infrastructure (DPI) is an open, interoperable platform that powers essential services like identity and payments. It comprises foundational systems that are accessible, secure, and support seamless integration. In practice, this has taken shape as the famous “India Stack.” For example, India has deployed at the population scale key building blocks such as Aadhaar and UPI.

Thanks to these public systems, India has made significant strides in inclusion and efficiency. For instance, Aadhaar-based eKYC helped raise bank account ownership from ~33% in 2011 to nearly universal by 2021. Analysts now say India “sets the global benchmark” for DPI-enabled governance and digital services. Conclusively, our DPI has turned roads and IDs into digital rails that connect citizens and businesses at a scale never seen before.

DPI and Sovereign Cloud: Fueling India’s AI Economy

India’s digital economy is on an exciting trajectory. A large slice of that will be AI-driven services like smart agriculture, precision health, financial inclusion, and more. But to fully capitalize on this opportunity, we need both rich data and trusted compute. DPI provides vast amounts of structured data (financial records, IDs, health info) and access channels. Combining that with a sovereign cloud means we can turn data into insight on Indian soil.

Indian regulators now view data itself as a strategic asset and fuel for AI. AI pilots (e.g., local-language advisory bots) are already being built on top of DPI platforms (UPI, ONDC, etc.) to deliver inclusive services. And the government has even subsidized thousands of GPUs for researchers. But all this computing and data must be hosted securely. If our AI models and sensitive datasets live on foreign soil, we remain vulnerable to geopolitical shifts and export controls. Recent U.S. export rules (the AI Diffusion Rules) cap the number of advanced GPUs that can be shipped to India, potentially throttling foreign cloud investment here. That scenario underscores the urgency of building domestic AI infrastructure.

In practice, combining DPI with a sovereign cloud means India-first infrastructure. It means running UPI servers, health AI models, and citizen data exclusively on Indian soil. It means having confidence that our algorithms are trained on our data within the country’s jurisdiction. With this base in place, startups and corporates can innovate freely, knowing compliance and trust are baked in. Ultimately, DPI and sovereign cloud together form the secure, India-led platform on which the AI economy will thrive.

Government Initiatives & India-First Policy

The government has already laid important groundwork. Under the Aadhaar and UPI era, India built DPI that leapfrogged decades of development. Now, policy is catching up with sovereignty. In 2023, the new Digital Personal Data Protection (DPDP) Act formally mandated local storage for sensitive personal data. In parallel, MeitY has expanded the national cloud: the NIC “GI Cloud” (MeghRaj) now serves 300+ government departments, and a new National Government Community Cloud (NGCC) framework has been launched for vetted providers. These steps begin the process of ring-fencing citizen and government data in-country.

Crucially, decision-makers emphasize self-reliance. This vision aligns with the “Aatmanirbhar Bharat” ethos: building our own data centers, mentoring our domestic cloud providers, and promoting Indian innovation in chip design and AI models.

Role of Industry and Next Steps

Tech leaders should come together to translate these policies into action. Private enterprises play a vital role in solidifying India-first cloud infrastructure. Key steps include:

Audit the data footprint: Map where all corporate data and AI workloads currently reside; classify any sensitive or regulated data according to India’s data sovereignty goals.
Require cloud transparency:In contracts and RFPs, mandate clear disclosure of data center locations, encryption practices, and compliance certifications; reject opaque “multi‑cloud” setups without guarantees of Indian jurisdiction.
Embed sovereignty in procurement:Treat data residency and security as criteria equal to cost or performance; include sovereign-cloud clauses in vendor evaluations to ensure both public- and private-sector procurements favor Indian-operated cloud solutions.
Collaborate on standards: Participate in industry consortia and open‑source initiatives that promote interoperability between sovereign cloud offerings; shared standards will help build a competitive Indian cloud ecosystem and prevent vendor lock-in.

Beyond these steps, the industry must continue to invest in homegrown capabilities. This means training more AI and cloud engineers, fostering startups in low-code and cybersecurity, and engaging in public‑private partnerships. Encouragingly, initiatives such as the India Stack and the Open Network for Digital Commerce (ONDC) have shown that India can build large-scale digital public goods with openness and sovereignty in mind. We should view those successes as templates for sovereign cloud development, too.

Looking Ahead: Owning India’s AI Future

India’s leadership in DPI has already set a global example, but true digital autonomy will be achieved only when our core infrastructure is India-owned. We face a critical choice: continue to rely on foreign cloud providers and chip imports, or accelerate a make-in-India cloud strategy. Today’s decisions will determine who owns the future of Indian AI.

In conclusion, the synergy of sovereign cloud and DPI will be the backbone of India’s AI economy. By securing our data and computing resources domestically, we lay an India-first foundation for innovation. This is a strategic imperative that India’s tech industry needs to champion- building the trusted, self-reliant infrastructure that enables India’s AI-driven growth and ensures our digital sovereignty.