As part of the deal, Google will invest USD 700 million to acquire 1.28 per cent stake in Bharti Airtel at a rate of Rs 734 per share.
The US headquartered technology giant will also invest USD 300 million toward potential multi-year commercial agreements.
The partnership will focus on enabling affordable access to smartphones across price ranges, and will continue to explore building on their existing partnerships to potentially co-create India-specific network domain use cases for 5G and other standards, and help accelerate the cloud ecosystem for businesses across India, the statement said.
"Airtel is a leading pioneer shaping India's digital future, and we are proud to partner on a shared vision for expanding connectivity and ensuring equitable access to the Internet for more Indians," Sundar Pichai, CEO of Google and Alphabet, said in the statement.
"Our commercial and equity investment in Airtel is a continuation of our Google for India Digitization Fund's efforts to increase access to smartphones, enhance connectivity to support new business models, and help companies on their digital transformation journey," Pichai said.
Up to USD 300 million that will go towards implementing commercial agreements include investments in scaling Airtel's offerings that cover a range of devices to consumers via innovative affordability programmes as well as other offerings aimed at accelerating access and digital inclusion across India's digital ecosystem.
"As a part of its first commercial agreement, Airtel and Google will work together to build on Airtel's extensive offerings that covers a range of Android-enabled devices to consumers via innovative affordability programmes. Together, the companies will continue to explore further opportunities to bring down the barriers of owning a smartphone across a range of price points, in partnership with various device manufacturers," the two companies said.
Commenting on the deal Sunil Bharti Mittal, Chairman of Bharti Airtel said, "Airtel and Google share the vision to grow India's digital dividend through innovative products. With our future ready network, digital platforms, last mile distribution, and payments ecosystem, we look forward to working closely with Google to increase the depth and breadth of India's digital ecosystem."
Under the larger strategic goals of the partnership, both companies will also potentially co-create India-specific network domain use cases for 5G and other standards, with cutting-edge implementations.
Airtel is already using Google's 5G-ready Evolved Packet Core and Software Defined Network platforms and plans to explore scaling up the deployment of Google's network virtualization solutions to deliver a superior network experience to their customers.
Both companies will also focus on shaping and growing the cloud ecosystem in India to accelerate their digital transformation journeys. Airtel serves over one million small and medium businesses with its enterprise connectivity offering, and this partnership will help accelerate digital adoption, the statement said.