The campus in Bengaluru, previously called Bangalore, is the first such investment made by a Chinese company in India and will be used to develop software components, Huawei said.
It is also the company's biggest R&D center outside China.
Modi has been making a push to lure foreign investors to the country and boost its manufacturing capacity.
"This center can accommodate nearly 5,000 software engineers, and we are confident that it will play a bigger role in the innovation journey of Huawei," said Wilson Wang, Chief Operating Officer of Huawei's India research and development.
(Reporting by Nivedita Bhattacharjee in Mumbai)