Malaysian technology firm Dagang NeXchange Berhad (DNeX) and Google Cloud on Monday announced a multi-year deal to provide sovereign cloud services in the country. The announcement comes as the Alphabet unit expands its footprint in the Southeast Asian country. Google said in May it would invest $2 billion to develop its first data centre and Google Cloud region in Malaysia.

The partnership was aimed at addressing demand for cloud solutions that meet strict data residency, security, and privacy requirements, particularly within regulated industries like public services, financial services, healthcare, and energy, the firms said in a joint statement.

Under the agreement, DNeX would be authorised to operate Google Distributed Cloud, which provides "air-gapped" solutions for Malaysian organisations - meaning it can operate without connection to the Internet or a Google Cloud region, they said. The firms did not specify a value or timeframe for the deal.

"Google Cloud and DNeX will empower organizations with the state-of-the-art distributed cloud infrastructure, developer tools, and AI services they need to drive digital transformation on their own terms," Vice President of Google Cloud Asia Pacific Karan Bajwa said in the statement.

DNeX and Google Cloud were also exploring the creation of an AI centre of excellence, a hub for nurturing local talent in artificial intelligence, the firms said.