Microsoft Corp is working closely with the Chinese government on 21 existing incubation centers across the country to help local startups better embrace artificial intelligence, according to a senior Microsoft executive, China Daily reported Tuesday.

These hubs, formed in tandem with local authorities and business partners, have already helped nurture over 600 startups whose combined valuation has topped 15 billion yuan (2.24 billion U.S. dollars), said Ralph Haupter, president of Microsoft Asia.

As a technology, AI is said to help double enterprise productivity by 2021, he said.

Such centers are scattered across China, including the less affluent Inner Mongolia autonomous region and Yunnan province.

Microsoft engages with governments at various levels in Asian countries to propagate AI.

According to Haupter, China is uniquely positioned due to Microsoft's long-standing research and development team here, which is also the company's biggest R&D facility outside of the United States.

China is said to have higher potential in leveraging the power of AI. The rate of expected innovation improvements in China in 2021 is 2.6 times that of the current level.

Similarly, the rate of expected employee productivity gains in 2021 is 2.3 times that of the current level.