New Delhi, Sept. 19 -- Rising spending on artificial intelligence (AI) infrastructure and higher government borrowing are pushing up the global cost of capital, as companies raise more debt and equity to fund investment while governments increase borrowing for infrastructure, energy security and defence, Goldman Sachs said in a report.

The report said the two major themes dominating investor discussions -- AI and rising interest rates -- are increasingly linked as demand for capital rises across both the private and public sectors.

"In the private sector a surge in capex spending to fund AI infrastructure has eaten into free cash flow and forced companies to raise more in debt and equity markets," the report said, adding that higher gov...