Indian ride-hailing firm Ola said it has tied up with Microsoft to build a connected-car platform and will use the U.S tech giant's Azure cloud-computing service to power its in-car entertainment offering.

The new connected-vehicle platform, for cars that have internet access, will have features to aid navigation, Ola said in a statement.

Ola, which has been locked in a fierce battle with rival Uber for a bigger piece of India's $12 billion taxi market, has said it would invest in artificial intelligence and machine-learning capabilities, which include technologies like its in-car entertainment platform called Play that allows riders to choose music and stream videos.

In July,  Microsoft announced that it was lookinto invest up to $100 million in Ola parent ANI Technologies.