Capture the opportunities

Australia’s success in capturing the opportunities of AI depends on equipping our people to get the best out of AI in their jobs, communities and their personal lives.

The government is supporting Australia to build the foundations for a world-class AI ecosystem. We are prioritising smart infrastructure and strengthening local tech capability so Australian businesses and researchers can lead in innovation. We are setting clear and stable conditions to attract domestic and global investment.

Australian workers across all industries are pivotal to capturing the opportunities of AI. A workforce equipped to build the necessary infrastructure, develop AI solutions, and apply them effectively across industries is essential to unlocking the full economic and social opportunities of these technologies. For workers to effectively adopt AI technologies, they must have confidence that AI will enhance their jobs and skills.

Capturing the opportunities of AI will help industry to scale, create high-quality jobs, and position Australia to compete successfully on the global stage.

Action 1: Build smart infrastructure 

Realising the opportunities of AI requires reliable and extensive digital and computing infrastructure, such as data centres. 

Smart infrastructure is essential not only to build local capability but also to secure Australia’s position in the region. Australia is a leading destination for data centre investment in the Indo-Pacific. We offer a stable operating environment, clear legal protections, abundant renewable energy potential, available land and proximity to growing economies. These factors, combined with Australia’s access to advanced chips vital for AI development, and connectivity through international submarine cables, make Australia uniquely placed to attract investment. 

Between 2023 and 2025, companies announced plans to make investments in Australian data centres that could scale up to more than $100 billion. Both international and domestic data centre operators have been investing heavily to expand Australian capacity. Investor enthusiasm is high. As Knight Frank reported, in 2024 Australia ranked second globally (after the US) as a data centre investment destination (Knight Frank 2025). 

Two components are critical to support AI at scale: high-quality computing power (compute) infrastructure and robust digital connectivity. Compute infrastructure provides the processing power required to run advanced AI models and data-intensive applications, ensuring development and deployment can happen domestically. The second component is the digital backbone, which includes high-speed networks, fibre‑optic connectivity and resilient telecommunications systems. These enable rapid data transfer and distributed processing across the country. 

Australia is connected to the global internet primarily through 15 international submarine cables. Australia plays an important role in connecting other states in the Indo-Pacific region to the international network. Investment in the subsea cable network is continuing, with Google announcing investments to build two further cables.

Our commitment to AI infrastructure

The Australian Government is already investing in Australia’s digital and physical infrastructure nationwide to support widespread AI development and adoption. Examples of actions already underway include:

• Expanding the NBN: Upgrading the National Broadband Network to deliver fast, reliable connectivity nationwide, including to regional and remote areas. Low Earth orbit satellites and expanded mobile coverage are also supporting greater access to AI services.
• Cybersecurity and secure critical infrastructure: Coordinating cross‑government efforts, led by the Department of Home Affairs, to uplift cybersecurity and safeguard Australia’s critical infrastructure.
• Enhancing regional leadership and partnerships: Coordinating government efforts, led by the Department of Foreign Affairs and Trade, to become the partner of choice in the Indo-Pacific region on trusted critical digital infrastructure.
• Mapping compute: The government is undertaking work to assess the landscape of available compute infrastructure to identify gaps and guide future investment opportunities. This will ensure that Australia’s research infrastructure keeps pace with technological advances and supports our world-class research system to remain competitive globally.

Data centres

We are positioning Australia as a leading destination for data centre investment while ensuring growth is sustainable and secure. The government is developing a set of national data centre principles in partnership with the states and territories, to clarify what it looks like for investment in data centres to align with Australia’s overall national interests. These principles will set clear expectations for sustainability and other factors, including bringing new renewable energy online and adopting efficient cooling technologies. Where investments align with the data centre principles, the government is exploring opportunities to coordinate data centre approval processes with states and territories, as part of our broader efforts to make it easier to develop major, transformational projects and invest in Australia.

Australia’s robust infrastructure planning processes will support growth in data centres in a way that supports affordability and reliability for all infrastructure users. For example, data centres are significant energy users and consumed around 4 TWh of electricity across the National Electricity Market in 2024, about 2% of grid-supplied power. Australia’s Energy Market Operator is monitoring data centre demand and accounting for electricity demand from these users to triple by 2030 (AEMO 2025). The government is working with the states and territories, energy market bodies, network service providers and the data centre industry to harness opportunities from the growth of data centres to promote investment in renewable energy and maintain affordable energy for households and businesses. 

Data centre operators have demonstrated interest in investing in Australia in ways that manage these impacts. For example, conventional data centre cooling systems can consume tens of millions of litres annually, but Australian operators are adopting innovative solutions such as highly efficient liquid cooling to significantly reduce water consumption. Many operators are already contributing to additional renewable energy generation and storage as part of their projects.

By setting strong principles and encouraging best practice, the government is ensuring data centre growth supports sustainability, strengthens energy security, and drives investment in clean technologies.

Australia has the opportunity to take advantage of ambitious AI infrastructure initiatives in ways that accelerate our renewables transition and drive investment in skills, research and sustainable technologies.

Our abundant renewable energy potential, robust privacy protections and strategic Indo-Pacific location can make Australia an AI hub for the region. Working closely with international partners, Australia can capture economic and social benefits that advance digital sovereignty, sustainability and innovation. 

It is in our interests to ensure that AI development happens locally, where it aligns with our national priorities, social and economic interests. It positions us to lead in shaping ethical standards, secure technologies and competitive industries, and ensures that AI serves Australian communities and businesses first.

Action 2: Back Australian AI capability

Australia’s competitive edge in AI is in developing targeted, high-value AI products and services for sectors such as healthcare, agriculture, resources and advanced manufacturing. Australian companies are already building world leading applications to help doctors diagnose disease and undertake surgery remotely and improve the way farmers manage their land and crops.

Building on this strength requires the right conditions for innovation. This includes the robust digital infrastructure referenced in Action 1.

The government is also considering the role of Australian-developed models within this landscape. Locally developed models may provide benefits such as reflecting unique cultural context or language, supporting innovation and mitigating risks around data security. 

The government is backing local capability through significant investment in sovereign AI for the public service. GovAI will act as a centralised AI hosting service, providing a secure, Australian-based platform for agencies to develop customised AI solutions at low cost. AI use in government can help deliver clearer, simpler services for Australians, and GovAI will ensure government departments can innovate responsibly while maintaining sovereignty, security, and cost-efficiency when deploying AI technologies.

Access to diverse, high-quality datasets from government, Australian companies and research institutions is an important foundation of AI models. Unlocking Australia’s data potential requires robust data governance, privacy protections, documentation, human oversight and legal compliance. 

By combining infrastructure, data, and targeted investment, Australia can accelerate the development and application of AI models. This will empower local businesses and researchers to deliver world-class solutions that make Australians’ lives better, help businesses be more efficient, and position Australia as a trusted AI provider in global markets.

Australia is investing in AI

The government is backing this ambition with more than $460 million in existing funding already available or committed to AI and related initiatives. The National AI Plan brings this investment together in a cohesive strategy to maximise benefits and manage risks for all Australians. The funding includes:

• over $362 million in targeted grants from the Australian Research Council, Medical Research Future Fund, National Health and Medical Research Council, and Cooperative Research Centres
• $47 million for the Next Generation Graduates Program
• $39.9 million to strengthen Australia’s AI ecosystem, which includes expanding the NAIC
• $17 million for the AI Adopt Program to support SMEs. 

These investments are complemented by broader technology investments that can support AI and related technology development, including:

• a further $1 billion commitment for critical technologies in the national interest, such as AI, under the National Reconstruction Fund
• $950 million registered by businesses for activities associated with AI under the Research and Development Tax Incentive Program, across the 2022‍–‍23 and 2023‍–‍24 income years.

The government is also helping Australia’s leading AI firms to expand internationally and compete on the global stage. Initiatives such as Austrade’s Landing Pads program provide international co-working space, networking opportunities and tailored advice.

Accelerating AI innovation

The government will build on these foundations by launching an ‘AI Accelerator’ funding round of the Cooperative Research Centres (CRC) program to accelerate the development and commercialisation of AI by businesses and researchers across Australia and turn innovative ideas into real-world solutions. 

Australia can be a leader in AI innovation and a trusted exporter of AI computing power, not just a consumer of AI technologies built elsewhere. With the right conditions, significant homegrown global businesses can emerge to create bespoke models and applications for both businesses and consumers. To make this happen, we must connect talented researchers with real-world challenges faced by industry and the community. The new CRC will strengthen local capability by incentivising partnerships between businesses and research organisations. It will help Australian ideas to scale and compete on the global stage. 

Australia’s data assets and AI

Data is a critical driver of modern economies, enabling innovation, efficiency, and informed decision-making across industries. AI models are only as good as the data they are trained on. Australia has high-quality and comprehensive data sets that could support AI innovations that create value for the AI sector, can deliver public goods, and that better reflect the Australian context. Both government and the private sector hold high value data sets which can support a globally competitive Australian AI sector.

The government is exploring opportunities to unlock high value datasets for pilot AI use cases, from both public and private sources. This work complements and builds on the existing program of work to improve APS data and data maturity. This includes work on consistent data standards and metadata, building trusted and secure approaches to data sharing, and identifying high value, non-sensitive datasets.

The government will also build on previously released resources by exploring ways to expand access to certain government datasets. This may include making the Australian Bureau of Statistics’ economic datasets available in ways which support AI training. In addition, large, unstructured datasets could be made accessible for AI system training. The government will work with industry to unlock private sector data for AI applications that deliver benefits to Australians. These initiatives will help develop and train AI models that are locally relevant.

Action 3: Attract investment

We are positioning Australia as a leading destination for AI investment. Building domestic capability and attracting foreign investment are critical for economic security, job creation, and national resilience. A stable and transparent environment ensures investment delivers strong returns while supporting world-class AI solutions.

Australia is an attractive AI investment destination

Australia is already attracting large investments relating to AI, showing growing investor confidence in our market. In 2024 alone, over $700 million in private investment flowed into AI firms (Bratanova et al. 2025). This is in addition to plans announced by various companies to make investments that could scale to more than $100 billion in Australian data centres, and to make significant investments in domestic and international cables and energy projects. 

Australia welcomes global investment to support local capability to build resilience in our AI, data infrastructure and energy sectors. Some investments into the sector may be subject to Australia's foreign investment framework to ensure they are not contrary to the national interest and national security

Australia has large domestic capital pools, such as superannuation funds, alongside strong foreign direct investment. Both forms of investment have an important role to play in growing the AI sector. Supporting national AI capabilities helps keep local innovations in Australia and deliver broad national benefits.

Supporting future AI investment

Our balanced approach will help secure Australia’s place as a trusted partner in the global AI landscape. To this end, the government is already:

• Facilitating investment in AI projects: through the Investor Front Door, actively working with States and Territories, to identify and address barriers to approvals that would impact AI investment, particularly in relation to data centres. The Investor Front Door as well as the Major Project Facilitation Agency is available to actively work with proponents to enable private investment that is nationally significant.
• Promoting AI investment: Austrade is attracting foreign direct investment to support the development of Australia's AI ecosystem. This includes investment to support development of innovative industry applications of AI in Australia and addressing gaps in Australia's digital infrastructure footprint.

The government will build on initiatives to ensure that investment flows into critical infrastructure and innovative AI ventures. This includes supporting significant data centre projects and their associated energy sources navigating regulatory approvals. 

Australia is attracting major projects, such as Project Southgate and multi-billion-dollar investments from Microsoft, Amazon and others (see Action 1).  

Australia is working towards collaborative arrangements with leading international and domestic AI companies. The goal is to signal our willingness to partner with innovators, improve our national AI capabilities, and uphold Australian standards.

Building on Actions 1–3: What’s next

The National AI Plan is closely aligned with the Future Made in Australia agenda. Investment in new data centres and other digital infrastructure will help secure Australia’s place in a rapidly changing world. Capturing the full spectrum of the AI opportunity – in terms of productivity, innovation and improved living standards – will ensure Australia can turn the changes and challenges of the present into the opportunities of the future.

Capturing the opportunities of AI requires sustained investment in data centres and the broader digital infrastructure that underpins them. Ensuring that local companies and researchers have access to the high-performance computing power they need for AI development is critical to building a strong, local technology sector.

As AI adoption increases across the economy, our digital infrastructure must keep pace. Growth must be managed responsibly, expanding capacity without placing unnecessary strain on existing resources.

Advances in AI are accelerating the development of quantum technologies. As quantum computing capabilities mature, they have the potential to power faster and more efficient training of AI models. Australia’s strengths in quantum position us well to capture these opportunities in the future. 

Securing resilient supply chains will be vital to Australia’s global competitiveness, supporting the development of local capability. Unlocking sources of domestic capital will be crucial to backing homegrown AI ventures and infrastructure, to keep the benefits of innovation in Australia. By tackling these challenges, we can secure a resilient, inclusive, and globally competitive AI future.

This plan should give the global investment community the confidence and certainty that it needs to back in an AI future in Australia. The successful adoption of AI in Australia will help Australians maximise existing competitive advantages in clean energy, advanced manufacturing, advanced medical and defence technological capabilities and high-quality service provision for the benefit of all Australians.