AWS, Microsoft Azure may shift workloads to India, Singapore

AWS and Microsoft Azure may reroute data center workloads from Dubai, Abu Dhabi, and Oman to India and Singapore amid the West Asian conflict, people involved in talks told The Economic Times.

An infrastructure company executive told ET that hyperscalers are seeking immediate capacity in Mumbai, Chennai, Hyderabad, and Kochi to reroute critical workloads, especially for banking clients.

On March 2, two AWS data centres in the UAE and one in Bahrain were struck by drones, affecting local banking apps, airport operations in Dubai and Kuwait, and forcing the UAE stock market to close due to tech outages.

According to AWS status updates, 25 services continue to be ‘disrupted’ and 34 have been ‘degraded’ in the AWS Middle East (UAE) Region (ME-CENTRAL-1).

Global reports suggest a Microsoft Azure facility in Tehran may have been targeted, but Microsoft has not announced any disruptions; AWS and Microsoft did not respond to ET’s queries.

Analysts, including Piyush Somani of ESDS, say India and Singapore have strong subsea links and that while the moves are likely temporary, they could spur investment as firms enact disaster recovery plans.

🔗 Source: The Economic Times

🧠 Food for thought

Implications, context, and why it matters.

The drone strikes damaged facilities, leading AWS to push regional moves

Drone strikes caused physical and structural damage at AWS data centres in the UAE and Bahrain. The sites also suffered fire damage plus water damage from suppression efforts 1.
AWS repeatedly urged customers to shift workloads to other regions and activate disaster recovery plans. AWS also said restoration could take multiple hours 1.
Large software providers that run on AWS, including Red Hat (an enterprise software company best known for its Linux tools) and Snowflake (a cloud data-warehouse company), told clients to fail over to other regions, including Europe 2.

Cloud reliability now carries geopolitical, legal, and financial exposure

The strikes push disaster recovery planning beyond routine outages and toward scenarios where entire regions become “operationally hostile overnight” 3.
Service Level Agreements (SLAs) may exclude this kind of event. Drone strikes could fall under force majeure, such as war or terrorism, which can leave customers paying for downtime 3.
Investors may price more risk into cloud providers after seeing physical conflict disrupt digital infrastructure. That could affect valuations for companies like Amazon, which earned roughly 57% of its operating income from AWS in 2025 (as cited in commentary on the incident) 4.