Global tech giant Microsoft is in discussions with the Telangana government on a proposal for setting up one of its largest data centres with an investment outlay of about USD 2 to 2.25 billion here, sources close to the development said on Thursday. If the discussions fructify, this would be one of the major investments of Microsoft outside the USA.

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Telangana Minister for IT and Industries KT Rama Rao kicked off the process of discussions by initiating dialogues with senior management of Microsoft about a few months ago. "The discussions are in the final stage. Certain issues such as whether it would be a single location or multiple and the size of the investment are yet to be finalised. Microsoft appears to be willing to go ahead with setting up a data centre here, though officially not confirmed," sources told PTI.

When contacted, a top official of the State IT Department said the Redmond, Washington-based IT bellwether requested the state government not to disclose the details of the discussions. An email sent to the PR agency of Microsoft has not yielded any reply.

Microsoft is slated to add data centres in at least 10 more countries this year, and the company is on pace to build between 50 and 100 new data centres each year for the foreseeable future, Noelle Walsh, a Microsoft corporate vice-president who leads the team that builds and operates the company's cloud infrastructure had reportedly said earlier. Set up in 1998 in Hyderabad, Microsoft India Development Centre is one of Microsoft's largest Research and Development centres outside the Redmond headquarters.

The centre represents Microsoft's strategy of globally shared development to build products and services. Amazon Web Services (AWS) in November announced the setting up of its second data centre region in India in Telangana that will be operational by mid-2022 and will see the tech giant investing about Rs 20,761 crore (USD 2.77 billion).