Lenovo has commenced the production of AI servers in India, marking a significant step in the company’s expansion strategy. This move reflects Lenovo’s commitment to meeting the growing demand for AI infrastructure in the Indian market. By leveraging local manufacturing capabilities, Lenovo aims to enhance its presence in the AI server segment and cater to the evolving needs of businesses in India.

Lenovo has started building artificial intelligence (AI) servers in southern India, a new step in India’s accelerating drive to become a major technology powerhouse.

The company begun manufacturing large, powerful computers in Pondicherry, southeast India, moving beyond products such as laptops and smartphones. The Chinese company will also expand its facilities in Bangalore, including setting up a research lab focused on artificial intelligence.

The plans are part of a broader shift as Lenovo seeks to position itself for an expected boom in AI-enabled PCs and devices. Lenovo’s Asia-Pacific president, Amar Babu, said the company will invest $1 billion globally over the next two years in research and development of AI platforms and devices.

Lenovo’s plans also represent another win for India as Prime Minister Narendra Modi seeks to attract more technology investment to the country. Despite growing tensions in India-China relations in recent years, global tech companies see India as an attractive option for expanding their operations, amid the trade dispute between Beijing and Washington.