L&T and Nvidia to Build India's Largest AI Factory in 2026

L&T and Nvidia Announce Landmark AI Partnership

Engineering and infrastructure major Larsen & Toubro (L&T) has announced a significant partnership with global technology leader Nvidia to build India's largest gigawatt-scale AI factory. The collaboration, unveiled at the India AI Summit on February 18, 2026, aligns with the government's India AI Mission and aims to establish a sovereign AI infrastructure to serve both domestic and international markets.

This venture combines L&T's extensive experience in engineering and infrastructure development with Nvidia's full-stack AI computing platform. The goal is to create a robust ecosystem that supports large-scale AI workloads, helping Indian enterprises transition from experimental AI projects to production-grade deployments. The initiative targets a wide range of users, including Indian companies, policymakers, global hyperscalers, and cloud providers seeking reliable AI capacity anchored in India.

The Vision for a Sovereign AI Infrastructure

A core objective of the partnership is the creation of a 'sovereign AI infrastructure'. This means that critical data, AI models, and intensive workloads can be developed, trained, and deployed within India's borders. This approach enhances data security and national control while ensuring the infrastructure remains interoperable with global technology ecosystems. The project directly supports the India AI Mission's vision of "Making AI in India and Making AI Work for India."

S N Subrahmanyan, Chairman & Managing Director of L&T, stated that Indian enterprises are prepared to scale their AI initiatives. He emphasized that this investment establishes the secure, scalable, and sovereign foundation necessary to power key sectors like manufacturing, energy, financial services, and healthcare, ultimately delivering measurable economic impact.

Integrating Advanced Technology and Infrastructure

The collaboration will integrate L&T's execution capabilities with Nvidia's comprehensive AI technology stack. This includes Nvidia's advanced GPUs, CPUs, networking solutions, and accelerated storage platforms. Additionally, the venture will leverage the Nvidia AI Enterprise software stack and established reference architectures to facilitate rapid and secure AI adoption across various industries.

Jensen Huang, Founder and CEO of Nvidia, described AI as the driver of the largest infrastructure buildout in history. He noted that the partnership with L&T, a company with a long history of nation-building, will lay the foundation for world-class AI infrastructure that powers India's growth and supports the government's vision to position the country as a global hub for digital infrastructure.

Expansion of Data Center Capacity

To realize this vision, the venture will significantly scale up L&T's data center capabilities. The plan includes expanding the Nvidia GPU cluster deployment at L&T's Chennai data center to 30 MW. This facility is part of a 300-acre gigawatt-scalable campus. Furthermore, a new 40 MW data center is currently under execution in Mumbai to support the initiative.

L&T currently operates 32 MW of data center capacity, with 14 MW already operational and another 18 MW expected to be commissioned by the end of the current fiscal year. The company has invested approximately ₹1,000 crore in its data center business to date.

Market Impact and Sectoral Focus

The 'AI factory' model is designed to deliver advanced, enterprise-grade AI services to a broad spectrum of clients. This includes global off-takers, hyperscalers, and Indian corporations across manufacturing, infrastructure, energy, financial services, healthcare, and public services. By providing standardized and predictable performance, the infrastructure aims to reduce the time-to-value for complex industrial and service-based AI use cases.

The partnership will also benefit L&T's group companies, enabling them to deploy live AI agents on a sovereign cloud. This fosters a self-sustaining innovation hub, leveraging frameworks like LTTS's Lights-Out Factory and LTM's Blueverse to transform industrial operations.

Stock Market Response

Following the announcement, the market responded positively. Shares of Larsen & Toubro Limited closed at ₹4,310.00 on the NSE on Wednesday, February 18, marking an increase of 0.71%. The collaboration is seen as a strategic move that positions L&T at the forefront of India's technological transformation.

Conclusion: A New Chapter for AI in India

The partnership between L&T and Nvidia marks a pivotal moment for India's AI ambitions. By building a national-scale, sovereign AI factory, the venture is set to meet the growing domestic and global demand for accelerated computing. This initiative not only advances the India AI Mission but also solidifies the country's role as a strategic hub for AI innovation and deployment, paving the way for widespread economic and industrial growth.