Soaring demand from Asian internet audiences for Western content has triggered two of India's latgest conglomerates to pump at least $4 billion (£1.9 billion) in fresh investment into the underwater pipes that carry online traffic around the globe.

Reliance Group and Tata have emerged as the leading independent owners of the infrastructure that puts the "world" into "world wide web" – a global system of submarine fibre optic cables that carries internet traffic and corporate data between continents.

Each group is planning to spend $2 billion upgrading its network, ending an investment drought in the sector after the dot-com crash of 2001 left a glut of overcapacity.

"Submarine cables are the information super highway," Srinivasa Rao Addepalli, head of corporate strategy for Tata Communications, said. "As globalisation increases, we need wider highways."

Industry estimates suggest about 60 per cent of internet traffic travels underwater at some stage. That figure is set to rise as demand from Asia, the world's largest online community, for online content hosted in the US spirals upwards.

According to Punit Garg, the head of Reliance Globalcom, surging broadband penetration in emerging markets – chief among them China and India – combined with the popularity of sites such as YouTube, which shift enormous amounts of video content, and mobile data services such as BlackBerry email are making undersea infrastructure investments viable for the first time in years.

"The world has a gigabit system; we are building it a terabit [1,000 times faster] backbone," he said.

Last week Google, which pays huge sums to move the data delivered for free by services such as Gmail, Google Earth and YouTube, revealed it will also invest in what will effectively be its own private transpacific cable by joining the Unity consortium. Unity plans to spend $300 million building a new link between Los Angeles and Tokyo that will feed further data tributaries that will penetrate Asia.

Transpacific bandwidth demand has grown at more than 60 per cent a year since 2002 and is expected to roughly double every two years until 2013, according to the TeleGeography Global Bandwidth Report.

Indian companies have found themselves in prime positions to benefit from the global data surge after acquiring key assets in the bottom of the market. Tata acquired Tyco Global Network, which has close ties to the US military, for $130 million in 2004. It now plans to invest a further $2 billion to augment the network.

Reliance Group, which purchased FLAG, a British-based competitor to Tyco for $207 million in 2004, is also preparing a plough in a further $2 billion. It recently reorganised its data infrastructure business as Reliance Globalcom, a group that is headquartered in London.

The other major player in the sector is Global Crossing, a group that is majority owned by Singapore Technologies Telemedia, and whose other shareholders include Carlos Slim, the Mexican telecoms mogul, Fidelity and Dupont.

Investment in undersea systems hit a high of $12 billion in 2001, before falling sharply to less than $1 billion a year from 2004 to 2007, according to Terabit Consulting, a specialist consultancy.

Tata is also interested in bidding for radio spectrum licenses in emerging economies that would allow it to roll-out wireless broaband networks in Africa and across Asia. It has also committed $100 million to building wi-max internet networks, where transmitters can cover a radius of about half a mile in urban areas, in a host of Indian cities.

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